Accumulate NTPC; target Rs 176: P Lilladher
Prabhudas Lilladher is bullish on NTPC and has recommended accumulate rating on the stock with a target price of Rs 176 in its October 26, 2012 research report.
November 03, 2012 / 13:02 IST
Prabhudas Lilladher is bullish on NTPC and has recommended accumulate rating on the stock with a target price of Rs 176 in its October 26, 2012 research report.
"NTPC’s PLFs suffered on account of lower coal supplies and grid restrictions, leading to a mere 3.5% growth on a YoY basis; they were at 74.9% in Q2FY13. However, the availability also suffered at 80.4% as against 83.1% in Q2FY12. The average tariff of generation in Q2FY13 stood at Rs3.1/Kwh. Adjusted PAT was up by 10.4% to Rs20.5bn.Plant commercialisation till H1FY13 stood at 2800MWs, while plants commissioned YTD stood at 2060MWs. Availability of Gas stations stood at 90% as against 92% in Q2FY12. Loss of generation due to shortage of coal was 5.1bn units as compared to 1.9bn units in Q2FY12 and 1.3bn units in Q1FY13. Imports of coal were down by 2.4mt YoY and domestic coal consumption increased by only 3.5MT. The company further targets to import 7mt in FY13E to compensate for domestic coal shortage. The average receivable days for the company have been around 35 days. Overall, the company has close to 17GWs under construction. Capex incurred in H1FY13 stands at Rs80bn out of the total planned capex of Rs210bn. In H2FY13E, NTPC targets to commercialise 2GWs. Q1FY13 capacity stands at 37GWs on a standalone basis, comprising 4GWs of gas-based plants. NTPC has planned to give out the tenders of 6 units of 800MWs.At 1.6x FY14E, the stock offers a defensive play within the sector. However, with increasing capacity, procuring coal would be a challenging task, going forward. Unless this issue is addressed, the stock will not see attractive earnings and thus, returns. Maintain ‘Accumulate’ on the stock with a target price of Rs 176," says Prabhudas Lilladher research report.Institutional holding more than 40% in Indian cos Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies 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.To read the full report click on the attachment 
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