Upcoming Webinar :Register now for 'ULIP as an investment during economic recovery' powered by Bajaj Allianz

Buy NTPC: Target Of Rs 123: Sharekhan

Sharekhan is bullish on NTPC recommended buy rating on the stock with a target price of Rs 123 in its research report dated November 02, 2020.

Nov 5, 2020 / 05:07 PM IST
 
 
live
  • bselive
  • nselive
Volume
Todays L/H
More

Sharekhan's research repor on NTPC


Management has guided for strong commercialisation of 5,566MW for FY2021, 7,336MW for FY2022, and 5,016 for FY2023 and expects fixed cost under-recoveries to reduce to Rs. 200 crore-220 crore by March 2021. NTPC board has approved buyback of equity shares not exceeding 19.8 crore shares (2% of the total paid up equity share capital) at a price of Rs. 115/share (29% premium to last closing price) for an aggregate amount not exceeding Rs. 2,276 crore. We recommend Buy on NTPC with a PT of Rs. 123, given earnings visibility (expect 19% PAT CAGR over FY21E-FY23E), RoE of 13%, attractive valuation of 0.6x its FY23E P/BV (54% discount historical valuations), and healthy dividend yield of 7-8%.



Outlook


NTPC’s Q2FY2021 PAT at Rs. 3,505 crore (up 7.4% y-o-y) was in-line with our estimate of Rs. 3,502 crore as higher-than-expected higher surcharge income at Rs. 657 (up 20% q-o-q) and increased regulated equity (up 19.3% y-o-y) was offset by FC under-recoveries of Rs. 271 crore.


For all recommendations report, click here


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.

Broker Research
first published: Nov 5, 2020 05:07 pm

stay updated

Get Daily News on your Browser
Sections