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UBS Investment Research
NTPC
Q 4 FY11: In line results
Q4 PAT up 38% YoY, in line with UBS estimates
In Q4FY11, NTPC’s operating income from electricity sales grew 26% YoY to
Rs155.2bn and reported PAT increased 38% YoY to Rs27.82bn. Adjusted for
exceptional items such as depreciation write back (Rs19m), provisions (Rs2.8bn)
and prior period sales (Rs4.2bn), the recurring PAT is up 25% YoY to Rs26.4bn.
Coal ministry to cancel allotment of 14 blocks, limited impact on NTPC
Coal ministry has decided to de-allocate 14 coal blocks of six PSUs, including 5
blocks of NTPC. We believe that NTPC and other companies are likely to raise
objections against this as the delay in development is a very common phenomenon
with majority of coal blocks. However, we await more clarity on this. Moreover,
apart from facing further delays in achieving better fuel security through captive
production, we don’t expect a significant impact on profitability as coal cost is a
pass through for NTPC.
Analyst call on 11th May at 4pm IST
NTPC has scheduled an investor and analyst conference call on Wednesday, 11th
May at 4pm IST. We expect to get more details during the call. However, we
understand that the near-term focus for the company is aggressive capacity
addition. The company intends to add another 25,000MW in next five years and
overall, it plans to become a 75,000MW generation utility by 2017.
Valuation: Maintain Buy and price target of Rs215.00
The key assumptions for our DCF-based price target are: 1) risk free rate of 8.1%,
2) intermediate growth of 7.5%, and, 3) and terminal growth of 5%.
National Thermal Power Corporation Ltd.
National Thermal Power Corp (NTPC) is the largest power generator in India,
accounting for 19% of installed capacity and 28.5% of generation as on 31
March 2008. Of the company's installed capacity, 86% is coal based and 14% is
gas based. It aims to double its generating capacity by 2015. It is integrating
backwards into coal mining, LNG imports, and forward into the transmission
and distribution sector.
Statement of Risk
We believe the key risk to our rating and price target is slower-than-expected
execution and unfavourable regulatory changes.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
UBS Investment Research
NTPC
Q 4 FY11: In line results
Q4 PAT up 38% YoY, in line with UBS estimates
In Q4FY11, NTPC’s operating income from electricity sales grew 26% YoY to
Rs155.2bn and reported PAT increased 38% YoY to Rs27.82bn. Adjusted for
exceptional items such as depreciation write back (Rs19m), provisions (Rs2.8bn)
and prior period sales (Rs4.2bn), the recurring PAT is up 25% YoY to Rs26.4bn.
Coal ministry to cancel allotment of 14 blocks, limited impact on NTPC
Coal ministry has decided to de-allocate 14 coal blocks of six PSUs, including 5
blocks of NTPC. We believe that NTPC and other companies are likely to raise
objections against this as the delay in development is a very common phenomenon
with majority of coal blocks. However, we await more clarity on this. Moreover,
apart from facing further delays in achieving better fuel security through captive
production, we don’t expect a significant impact on profitability as coal cost is a
pass through for NTPC.
Analyst call on 11th May at 4pm IST
NTPC has scheduled an investor and analyst conference call on Wednesday, 11th
May at 4pm IST. We expect to get more details during the call. However, we
understand that the near-term focus for the company is aggressive capacity
addition. The company intends to add another 25,000MW in next five years and
overall, it plans to become a 75,000MW generation utility by 2017.
Valuation: Maintain Buy and price target of Rs215.00
The key assumptions for our DCF-based price target are: 1) risk free rate of 8.1%,
2) intermediate growth of 7.5%, and, 3) and terminal growth of 5%.
National Thermal Power Corporation Ltd.
National Thermal Power Corp (NTPC) is the largest power generator in India,
accounting for 19% of installed capacity and 28.5% of generation as on 31
March 2008. Of the company's installed capacity, 86% is coal based and 14% is
gas based. It aims to double its generating capacity by 2015. It is integrating
backwards into coal mining, LNG imports, and forward into the transmission
and distribution sector.
Statement of Risk
We believe the key risk to our rating and price target is slower-than-expected
execution and unfavourable regulatory changes.
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