NTPC Q4 Results Review - The Best Of Both Worlds: ICICI Securities

ICICI Securities Report

NTPC Ltd. is one of the best plays on the increasing total addressable market for power capex – led by security of the grid and increasing renewables penetration. It is the beneficiary of both the worlds – conventional and renewables.

It has laid out a plan to add 24 giga watt of thermal capacities and 64 GW of RE capacities by 2032. As a result, visibility on cost plus or regulated earnings has improved. We estimate cost plus earnings to grow at 10-12% CAGR in medium term.

We expect NTPC to accelerate RE capacity addition on the back of 20 GW tied up capacity. As a result, we expect Ebitda of RE capacity to grow at 30% CAGR over the next three years.

We resume coverage on NTPC with Buy and SoTP-based target price of Rs 495 per share.

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