NTPC Q4 preview: Earnings likely to rise on higher power generation, capacity additions

Analysts will be watching out for updates on progress on renewable and thermal capacity additions, regulated equity growth, and the outlook for coal-based generation during peak summer demand.

Trade

• Watchlist
• Portfolio
• Message
• Set Alert

 

 

live

• bselive
• nselive

Volume

Todays L/H

More

×

NTPC is set to report its earnings for the fourth quarter of FY25 on May 24. Brokerages expect earnings to grow on higher power generation and increased capacity.

According to the average of a Moneycontrol poll of five brokerages, NTPC is likely to see revenue rise nearly 9 percent on-year to Rs 46,327 crore compared to Rs 42,532 crore reported in the same quarter last year. Net profit is likely to grow 10 percent from a year earlier to Rs 5,643 crore.  The Earnings before Interest, Taxation, Depreciation and Amortisation (EBITDA) margin is expected to increase from 26.6 percent to 27 percent.

The most optimistic of the estimates, by Equirus, sees net profit increase by an annualised 18 percent to Rs 6,012 crore. Elara Capital is the most conservative, estimating net profit growth at just 6 percent.

What will impact the earnings

Brokerages remain optimistic on NTPC’s Q4. Here are the factors that are expected to impact the earnings.

Higher power generation

Most brokerages expect higher power generation to aid the Q4 earnings. Equirus reported that NTPC Group's power generation during FY25 stood at 438.6 BU, reflecting a 4.3 percent growth in Q4, aided by the early onset of summer and an overall 1.6 percent increase in coal-based generation during the quarter. The company added 1.2 GW of capacity, including 660 MW coal-based and the rest solar. However, solar capacity additions were lower than the Q3 guidance. MOSL expects NTPC’s adjusted PAT to grow 9 percent YoY, backed by higher generation and capacity expansions.

Increase in capacity

According to Elara Securities, NTPC commissioned 473 MW of solar capacity in Q4. It plans to expand thermal capacity by 26 GW by FY32, aligned with the government’s 80 GW target. Already, 17.6 GW is under construction, and 7.2 GW is set to be tendered in the next two to three years.

Steady cash flow
Nuvama notes that profitability in NTPC’s standalone business remains relatively insulated due to the regulated return model. Even with limited commissioning over the last year, the regulatory mechanism ensures stable and assured returns. JM Financial adds that while YoY revenue and EBITDA may remain flat due to higher fuel costs and lower non-operating income, the overall business model offers earnings stability.

Increase in regulated equity

Elara Securities notes that NTPC’s regulated equity stands at Rs 1.06 lakh crore and is expected to grow at a double-digit rate in the near term due to ongoing projects. The company earns assured returns on these regulated assets, leading to expectations of a 6 percent revenue and 4 percent PAT growth in Q4. Nuvama and Sharekhan also foresee earnings stability and moderate PAT growth (around 8 percent), anchored by the strength of NTPC’s regulated model.

 What to look out for in the quarterly show?

Analysts will be watching out for updates on progress on renewable and thermal capacity additions, regulated equity growth, and the outlook for coal-based generation during peak summer demand.