Motilal Oswal neutral on NHPC

Motilal Oswal has maintained neutral rating on NHPC, in its August 10, 2011 research report.

"NHPC reported 1QFY12 PAT of INR7.9b (up 21% YoY) and adjusted PAT of INR5.6b, in line with our estimates. In 1QFY12 NHPC did not use the corporate tax rate for gross-up of RoE (as it did in 4QFY11 with retrospective effect, gaining INR6.5b), and the company will review this at the end of the year, based on capacity addition. The management indicated that the higher generation led to high secondary energy incentives of INR810m (v/s INR440m YoY). In 1QFY12 NHPC's standalone generation was 6.3BUs, up 11% YoY, led by increased capacity at Sewa (120MW, CoD in June 2010) and by buoyant monsoon. NHPC's installed capacity stood at 5.3GW. NHPC reported availability of 91.94% from April to July 2011 v/s an annual availability target of 79.90%.

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