Buy Power Grid Corporation of India; target of Rs 242: Khambatta Securities

Khambatta Securities is bullish on Power Grid Corporation of India has recommended buy rating on the stock with a target price of Rs 242 in its research report dated December 14, 2021.

Broker Research

December 14, 2021 / 14:21 IST

26 Aug, 2025 12:21

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Khambatta Securities' research report on Power Grid Corporation of India

Power Grid Corporation of India (PGCIL) is the largest electric power transmission utility. It holds the leadership position in the Indian Power Transmission sector. The company has a high operational efficiency and strong execution track record. During FY 20-21, the PGCIL achieved system availability of 99.78%. The trippings per line decreased to 0.36, which is lowest in last five years. Strong power generation capacity additions in the country will augment the growth in the transmission lines. Power demand in India is estimated to grow 8-8.5% in FY22, according to ICRA. High capex outlay will lead to revenue traction. PGCIL has a capex target of ₹ 7,500 crores for FY22 of which ₹ 3,695 crores has already been incurred in the 1HFY22. PGCIL has been consistent in rewarding its shareholders by way of distributing dividends. There has been an increase in dividend payout since past five year.

Outlook

Our valuation at 10x FY24EPS generates a target price of ₹ 242 with 18% potential from levels now, signalling a BUY rating. At our Target price of ₹ 242, the stock trades at 2x FY24E P/BV.

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