Moneycontrol
Nov 14, 2017 11:43 AM IST | Source: Moneycontrol.com

NTPC gains 1% post Q2 numbers; CLSA retains buy, expects RoE expansion over FY17-19

Morgan Stanley has an Equal Weight on NTPC with a target of Rs 149 while CLSA has retained a buy on the stock with a target of Rs 200.

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Share price of NTPC was up 1.05 percent intraday on Tuesday after the company reported a decline of 2.3 percent in its standalone net profit at Rs 2,438.60 crore for quarter ended September due to higher borrowing and depreciation cost. The total income of the company rose to Rs 19,960.35 crore in second quarter compared to Rs 19,588.56 crore a year ago.

The depreciation costs rose to Rs 1,712.68 crore in the second quarter from Rs 1,434.15 crore a year ago. Similarly the finance cost increased to Rs 919.47 crore in the quarter from Rs 889.83 crore a year ago.

Moneycontrol takes a look at various research firms' outlook on NTPC:

Brokerage: Morgan Stanley | Rating: Equal Weight | Target: Rs 149

Global research firm Morgan Stanley has an Equal Weight on Power generation company NTPC with a target price of RFs 149 per share. The company posted its Q2 EBITDA and net profit which was above the estimates, but was below the street’s expectations.

The house estimates implied core RoE for Q2 stood at over 20 percent while the downside risks include sluggish demand environment and slower capacity additions.

Brokerage: CLSA | Rating: Buy | Target: Rs 200

Research firm CLSA has reiterated a buy call on NTPC as the company is getting closer to robust RE growth with a target price of Rs 200 per scrip. According to the research firm, NTPC added 1,210 MW capacity in Q2 which is the highest addition in any quarter. It expects marked pick-up in regulated equity growth to 21.4 percent and return on equity to expand by 230 bps over FY17-19.

At 11:37 hrs NTPC was quoting at Rs 178.65, up Rs 1.70, or 0.96 percent. It has touched an intraday high of Rs 181.45 and an intraday low of Rs 177.70.
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