Analyst Call Tracker | In a sea of ‘buys,’ this brokerage has a ‘sell’ call on NTPC

NTPC also plans to increase its renewable energy capacity to 60 GW by 2032

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26 Aug, 2025 12:21

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NTPC, India’s largest power generation company, may have checked all the right boxes and attracted positive investor interest with the stock gaining almost 50 percent over the past year.

Most analysts are bullish on the NTPC stock, given its steady capacity addition and growing renewable energy portfolio, offering a potential stock re-rating.

Also read: NTPC logs 83% growth in coal output in first half of this fiscal

According to Moneycontrol's Analyst Call Tracker, 96 percent of analysts have a ‘buy’ call on NTPC. However, one brokerage recommends a ‘sell,’ citing input cost and coal availability concerns.

The NTPC stock ended at Rs 235 on October 4, up from Rs 163 a year ago. Over the past five years, the share has gained 73 percent.

Contra view

Contrary to other brokerages, Geojit Financial Services has a ‘sell’ call on NTPC. According to its September 2023 report, while NTPC’s capacity addition will support rising power demand, coal price volatility and uncertain domestic availability of the fuel could impact profitability in the future.

Geojit also said the stock’s valuation looks expensive. It downgraded its rating on the NTPC and set a revised target price of Rs 215, an 8 percent downside.

Also read: NTPC inks pact with 6 kendriya vidyalayas in Arunachal for infra development

Overall optimism

Analysts at ICICI Securities have a ‘buy’ rating on NTPC saying the base business will grow and outperform others in the medium term. According to their report, NTPC is the only company to have added coal-based capacity over the past five years and reached an installed base of 73,000 MW on a consolidated basis.

Additionally, they said the renewable capacity addition plan of 16,000 MW over FY24-FY26 will scale up the company’s green portfolio and lead to a rerating of the stock. ICICI Securities maintained a ‘buy’ rating on the stock with a Rs 300 share target price.

Anand Rathi is also optimistic about NTPC’s expansion into clean energy. The brokerage’s analysts said the company’s growth prospects are improving and they expect a multiple re-rating due to a higher green energy share aiding in an increased ESG score. Anand Rathi initiated coverage on NTPC with a ‘buy’ rating and a target price of Rs 300.

According to analysts at Jefferies, as NTPC’s renewable energy portfolio grows, the stock will continue to get re-rated. Renewable energy capacity addition does not have the challenges of coal availability and price volatility faced by thermal power plants.

“We are confident that NTPC will be among the largest RE companies in India and also globally in the next decade, given the financing and scale advantage,” Jefferies analysts said. They have a ‘buy’ call on the stock and revised the target price to Rs 300 from Rs 255 previously.

Steady demand

The state-owned power company’s revenue was Rs 43,075 crore in the first quarter of FY24 compared with Rs 43,177 crore a year earlier. Earnings before interest, taxes, depreciation and amortisation (EBITDA) grew 17.8 percent YoY to Rs 13,170 crore and the EBITDA margin increased 470 basis points YoY to 30.6 percent. Profit after tax grew 23.3 percent to Rs 4,907 crore in Q1FY24.

The company’s coal production doubled to 8.59 metric tonnes from 4.27 metric tonnes a year ago. NTPC commissioned its first overseas plant in Bangladesh in the quarter.

The company plans to increase capacity to more than 130 GW by 2032. For the quarter, installed capacity increased 5.7 percent to 73,024 MW. Currently, 17,463 MW of capacity is under construction.

NTPC also plans to increase its renewable energy capacity to 60 GW by 2032. It currently has an installed capacity of 3.3 GW with 5.9 GW under construction.

NTPC currently has a market capitalisation of about Rs 2.27 lakh crore.

Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.