Motilal Oswal has come out with its earnings estimates on utilities sector for December quarter FY13. The research firm expects utility companies in their coverage to report aggregate 3QFY13 revenue growth of 15% YoY and PAT growth of 12% YoY. Muted PAT growth is on account muted PAT of few IPP's however CPSU's led by NTPC (higher capacity addition), PGCIL (better Capitalization) would show PAT growth of 11% and 31% YoY respectively. Amongst the IPPs, JSW energy is expected to report strong PAT growth (2x YoY), due to low base/robust performance and ST prices in 3QFY13.
Valuation and view: Power sector has begun to witness several initiatives by authorities to address concerns on SEBs, fuel supply pacts and PPAs. However, it would take a while for clarity on several issues to emerge. Hence, we continue to prefer CPSUs which are relatively better-positioned on these fronts. Top picks are NTPC and Power Grid.| Sales (Rs in mn) | Net Profit (Rs in mn) | |||
| Dec. 2012 | % Chg YoY | Dec. 2012 | % Chg YoY | |
| CESC | 12,942 | 25.4 | 1,674 | 126.3 |
| Coal India | 167,185 | 8.9 | 42,568 | 15.4 |
| JSW Energy | 23,615 | 33.5 | 1,730 | 215.3 |
| NHPC | 9,499 | 7.7 | 2,568 | -13.7 |
| NTPC | 174,810 | 14 | 23,030 | 11.3 |
| Power Grid | 34,649 | 40.5 | 10,131 | 30.8 |
| PTC India | 21,233 | 59.6 | 467 | 390.8 |
| Reliance Infra | 39,155 | -12.6 | 2,998 | -26.1 |
| Tata Power | 81,168 | 21.9 | 3,259 | -41 |
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