Maharatna Bluechip Stock To 'Buy' As Leading Broker Projects Upto 20% Gains

Published: Tuesday, January 31, 2023, 0:24 [IST]

Emkay Global sees a potential gains of 20.48% returns from NTPC, maharatna large cap stock. NTPC is the largest central public sector undertaking under the Ministry of Power, Government of India to generate and distribute electricity. Recently in a filing to the exchange, dated January 28, 2023 of this large cap company announced an interim dividend for the financial year 2022-23.

As per the analyst coverage report, "Power demand in India has been on the upswing and, given the demand-supply dynamics, plant load factor (PLF) of existing units is expected to rise from current levels. At the end of 9MFY23, NTPC-coal/All-India thermal units clocked ~75%/~63% PLF. Given the low coal plant additions in the recent past, companies like NTPC with a high coal asset base and operational capability will benefit from the surge in demand in coming times."

NTPC results snapshot

NTPC results were above the consensus estimates of Emkay Global analyst. "NTPC reported adjusted profit after tax (PAT) of Rs 44.2 billion - 18% YoY growth in 3Q, taking 9MFY23 growth to approximately 10% YoY. PAT was above consensus/our estimates, with under-recovery coming down and 3Q turning out to be a decent quarter from the incentive perspective."

The coverage report even stated the utilization levels, "Plant availability factor (PAF) for coal units stood at 92.67% in 3QFY23 vs 85.98%. Coal PLF for 9MFY23 stands at 74.45% vs 69.1% YoY. Utilization of NTPC units have been on the rise since the last few years, on strong power demand in the country. We believe that given the high operational standard of NTPC units, PLFs can go above 90% in coming years, if demand growth continues."

Buy NTPC large cap stock with a target price of Rs 200

According to the Emkay Global coverage report, NTPC exhibits higher utilization and capacity, as the company targets higher 60GW renewable energy (RE) capacity by 2032, which will bode well. "We maintain BUY with Mar-24 target price of Rs200. We raise our EPS estimates by approximately 4% each for FY23/FY24/FY25. High utilization, strong capacity addition and RE monetization are all positives for the company, in our view."

The current market price is Rs 168.85 per share, with an intraday growth of 1.53% Buying now at the current market price will fetch you potential gains of 18.45%. Its 52-week high is at Rs182.80 per share and 52-week low is at Rs 123.70. Over 1-year this power sector large cap stock has given 19.75% returns.

Interim dividend of 42.50%

In the company board meeting held on January 28, 2023, along with the financials, the board of directors approved to pay the declared interim dividend, as mentioned in the BSE filing "Board of Directors in its aforesaid meeting decided, inter alia, to pay interim dividend at the rate of 42.50 % (Rs. 4.25 per share) on the face value of paid-up equity shares of Rs10/- each for the financial year 2022-23."

The filing also had details regarding the ex-dividend details, "The date of payment/ dispatch of dividend shall be February 24, 2023."

Disclaimer

The stocks have been picked from the brokerage report of Emkay Global, the Author, and the respective Brokerage house are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to consult with certified experts before making any investment decision.

Story first published: Tuesday, January 31, 2023, 0:24 [IST]

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