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NTPC looks cheap compared to peers: Nirmal Bang
Nirmal Bang has come out with a research report on NTPC's follow-on public offering (FPO). The research firm has recommended subscribing to this follow on public offer.
Nirmal Bang has come out with a research report on NTPC 's follow-on public offering (FPO). The research firm has recommended subscribing to this follow on public offer.
The FPO of India's largest power generation company NTPC opened for subscription. The floor price for the FPO of 412,273,220 equity shares of Rs 10 each is at Rs 201/share and the issue will close on February 5, 2010. The issue has been subscribed 0.79 times so far, as per data available on the NSE website.
Nirmal Bang report on NTPC FPO -
We believe that NHPC, Neyveli Lignite and Tata Power are the best comparable company as both the NHPC and Neyveli lignite are PSU's and Tata power being the old player in the Industry. We tried to compare the companies on the basis of PE and Price/Book Value.
On the basis of Price earning, NTPC at the price of Rs 201 is undervalued than its peers. Even on the basis of P/BV, NTPC is undervalued comparable to the Neyveli Lignite and Tata power and slightly costlier than NHPC.
At the offering price, it looks cheap as compared to it peers and has good potential for upside. We recommend subscribe to this follow on public offer.
Disclaimer: The views and investment tips expressed by investment experts on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
