NTPC reported decent Q3FY19 results, mostly ahead of our estimates, except minor miss on PAT. Revenue grew 16.1% YoY to Rs 241.2bn (est. Rs 226bn) while EBITDA registered 20% YoY growth to Rs 62.7bn (est. Rs 60.5bn). EBITDA margin expanded 82bps YoY to 26% due to fall in employee costs and other expenses. This was despite 19% YoY rise in fuel costs. PAT for the quarter was mostly flat at Rs 23.8bn (est. Rs 24.6bn) against Rs 23.6bn in Q3FY18. Maintain BUY with revised TP of Rs 178.
Outlook
At CMP of Rs 140, NTPC is trading at 0.94x FY20E and 0.86x FY21E BV, which is below its ten-year average of 1-year forward P/BV of ~1.6x. After factoring in Q3FY19 and 9MFY19 results we have tweaked our FY19E and FY20E estimates slightly and introduced FY21E estimates.
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