NTPC Share price today: NTPC has continued to report strong operational numbers in Q3 FY21 on the back of power demand recovery. While reported standalone/consolidated PAT was Rs 33.1 bn/ Rs 38.8 bn, up 10.7%/21.2 YoY, adjusted PAT was Rs 33.1 bn/ Rs 39 bn, up 23.6%/35.5% YoY respectively. With 9MFY21 consolidated adjusted profit at Rs 116.8 bn, up 24% YoY, NTPC is expected to register 15% earnings CAGR over FY20-FY23E. Its green commitments remain on track with 1.4GW operational, 2.7GW under implementation and 1.4GW under tendering. Currently, share price of NTPC is Rs 99.8. 

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In addition, NTPC has won 1.3GW in recent bids and is participating in the upcoming 5GW IREDA CPSU auction (expected by Mar’21). Overdue receivables declined by Rs 25 bn QoQ and a further Rs 10 bn in Jan’21 to Rs 157 bn (expect further Rs 80 bn reduction by Mar’21). NTPC announced an interim dividend of Rs3/share. Maintain BUY with an unchanged target price of Rs 165/sh.

NTPC Dividend announced:

NTPC announced a dividend of Rs3/share. It expects to continue paying a higher of 30% of PAT or 5% of net worth as an annual dividend going forward.

NTPC Decoding the quarter for the year ahead:

With reported EPS for the standalone/ consolidated entity at Rs 9.4/ Rs 10.4 and adjusted EPS at Rs 10.7/ Rs 11.8 in 9M FY21, ICICI Securities believes, NTPC is on course to achieve its FY21 target EPS of Rs 12.3/ Rs 14 (not adjusted for shares extinguished post-buyback). Rs 82.2 bn increase in standalone regulated equity in TTM plus THDC and NEEPCO addition have resulted in strong core earnings. A robust commissioning pipeline, supported by green initiatives will strengthen core earnings further.

Overdue receivables have declined substantially and stood at Rs 167 bn vs Rs 191.6 bn at Q2 FY21-end and further declined to Rs157bn by Jan’21-end. NTPC expects to receive Rs80bn more through tranche-II of the PFC/REC scheme by Mar '21. Total capacity commercialised till 9MFY21 reached 2,799MW and target for FY21/FY22 is 5,074MW/6GW at group level. Under-recovery was Rs5.7bn as at 9M FY21-end vs Rs 5 bn at Q2FY21-end. Company expects to close FY21 under-recovery at Rs 3.5 bn.