CoValue Markets

NTPC: Undervalued?

intrinsic valuation covalue

Expectations built in the CMP are -10% CAGR of Sales for 10 Years with 17.5% OPM. Negligible risk of COVID-19 and a Great Business model.

NTPC – India’s largest power utility company with an installed capacity of 62,110 MW (including JVs), has plans to become a 130 GW company by 2032. Established in 1975, NTPC aims to be the world’s largest and best power major energizing India’s Growth. The company has a robust regulated business model, which will have a negligible impact on COVID-19.

The growth of the Company depends on Capacity Creation and Plant Availability. It has seen the highest Annual Asset Commissioning of 5,290 MW during FY2020. Further, the significant improvement in coal availability will improve its Operating Profit Margins. NTPC has also made some Value-Accretive acquisitions that will add 2,500MW of operating hydropower capacity to the firm’s predominant thermal portfolio. NTPC Ltd will pay INR 11,500 Crores to acquire the government’s stakes of 75% in THDC India Ltd and 100% in North Eastern Electric Power Corp. Ltd 

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About the author


Ajit Singh

Ajit Singh is a Chartered Accountant and Investment Professional for over 20 Years. He loves exploring Companies and Valuing them. He is fond of Start-ups and very passionate about Entrepreneurs.

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