Buy 2 Maharatna & 1 Miniratna Power Stocks For High Returns, Upto 6% Dividend Yield

NTPC

The current market price of the company is Rs. 166.20/ share, and Emkay Global has estimated a target price for the stock at Rs. 188/share for March 2023, and given buy rating. In the last 1 month it has given 4.69% returns, and in the last 6 months it has given 25.77% returns. Its 52-week high market price is Rs. 170.15, and 52-week low market price is Rs. 114.15. It is a large cap maharatna stock with a market capitalization of Rs. 161,352 crore. It is offering above 4% dividend yield.

Stock advantages - NTPC

"During July-August 2022, generation for NTPC (Standalone) grew by 9.2%, which is great considering all Indian thermal generation stood flat. Generation from key subsidiaries/JVs of NTPC grew by 28%. NTPC is expected to monetize its RE assets in the near future and continues to target 60+GW RE assets by 2032. Incremental thermal assets (5GW planned) will add to steady earnings growth. The stock price of NTPC has increased by over 50% in the last one year, but it still trades at ~1x PB on FY25E with ~12% RoE and 6-7% earnings CAGR," stated Emkay Global.

Power Grid

The current market price of the company is Rs. 224.30/ share, and Emkay Global has estimated a target price for the stock at Rs. 250/share for June 2023, and given buy rating. In the last 1 month it has fallen by 1.99%, and in the last 6 months it has given 5.11% returns. Its 52-week high market price is Rs. 248.35, and 52-week low market price is Rs. 172.70. It is a large cap maharatna stock with a market capitalization of Rs. 156,215 crore.

Stock advantages - Power Grid

"While transmission intensity might have come down in the last few years, the medium-term outlook clearly indicates 5/6% growth in Power Grid's earnings. Our June 2023 target price of Rs. 250 is based on SoTP analysis. At the current market price, dividend yield stands at around 6%. Intra-state transmission opportunities and smart metering-related investment remain key monitorables apart from inter-state opportunities," Emkay Global added.

NHPC (National Hydro Electric Power Corporation Pvt Ltd.)

The current market price of the company is Rs. 37/ share, and Emkay Global has estimated a target price for the stock at Rs. 40/share for June 2023, and given buy rating. In the last 1 month it has given 7.25% returns, and in the last 6 months it has given 31.67% returns. Its 52-week high market price is Rs. 40.40, and 52-week low market price is Rs. 27.05. It is a large cap miniratna stock with a market capitalization of Rs. 37,116 crore.

Stock advantages - NHPC

According to Emkay Global, "NHPC is expected to commission 2,800 MW of hydro capacity (50% of its present capacity of 5.5GW) over the next two years. Parbati II (800MW) and Subansiri (2,000MW) are at advanced stages of construction. Together, they will add Rs90bn to the regulated equity (up from Rs130bn to Rs220) over the next 2-3 years. Apart from 2800MW under construction at the standalone level, NHPC has ~3.6GW of projects under construction through subsidiaries/JVs. On the RE side, 1,040MW of solar projects are under construction and 600MW is under a tender stage at the standalone level. This will lead to improvement in RoE from 9.5% to ~11% by FY2025. We expect an EPS CAGR of ~11% over FY22-FY25E."

Return comparison from stocks - NSE

In this table the Current Market Price (CMP) and the Target Price (TP) of the recommended stocks have been mentioned.

Disclaimer

The above stocks were picked from the brokerage report of Emkay Global. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution. Greynium Information Technologies, the author, and the Investors must therefore exercise due caution. Greynium Information Technologies, the author, and the brokerage house are not liable for any losses caused as a result of decisions based on the article.