The brokerage firm says that the company was leading the energy transition with 17 percent market share of solar bids in the second half of FY21
CLSA also believes that NTPC has created a stage for even better achievement in FY22 with 1.3GW worth of plants set to commercialise in the first quarter
Brokerage firm CLSA has given a ‘buy’ rating for NTPC, stating that the company was now leading the energy transition with 17 percent market share of solar bids in the second half of FY21. CLSA has set a price target of Rs 150 for the stock.
“A stellar 3.5GW of regulated capacity commercialisation at NTPC group despite the national lockdown, a 25 percent rise in solar capacity, 100 percent realisation of the billed amount from discoms and the closure of old thermal plants to improve ESG were key achievements in FY21,” said the brokerage.
CLSA added that NTPC has also created a stage for even better achievement in FY22 with 1.3GW worth of plants set to commercialise in the first quarter of this financial year. The brokerage firm believes that all this will drive double-digit earnings per share growth for NTPC in FY22.
“Buy NTPC, as improved visibility for capacity additions will help it expand its regulated equity (RE) by 36 percent and return on equity by 160 basis points over FY21-23CL,” stated the CLSA report.
In the auction by Gujarat Urja Vikas Nigam Limited (GUVNL) in December 2020, NTPC emerged as one of the winners for the recent bids for solar projects, including a bid for 200MW at Rs 1.99 per kWh, the lowest tariff quoted in India, in a 500MW. Similarly, in another recent bid by GUVNL in March 2021, both CIL and NTPC have emerged as winners for 150MW and 100MW capacities, respectively, at Rs 2.20 per kWh.