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ICICI Securities Report
NTPC Ltd.‘s standalone adjusted profit in Q1 FY21 was Rs 27.1 billion (down 7.8% YoY), but adjusting one-time rebate on fixed charges to distribution companies of Rs 8 billion (pre-tax), adjusted profit increased 14.8% YoY to Rs 33.7 billion.
Being the first full quarter post the acquisition of Tehri Hydro Development Corporation Ltd (THDC) and North Eastern Electric Power Corporation Limited (NEEPCO), NTPC's adjusted consolidated profit increased 21.3% to Rs 38.5 billion.
The company's core return on equity (RoE) remained strong at 19.5%, but fixed cost under recovery was at Rs 2.3 billion (Rs 1.2 billion in Q1 FY20).
On Q1 FY21 consolidated profit basis, annualised earning per share comes to Rs 15.4, Q1 FY21-end RoE at 12.5% (pre-exception) and book value/share at Rs124.
Thus, NTPC is on course to achieve the FY21E target earning per share of Rs 12.3/Rs 14.5 for standalone/consolidated entity (ex-rebate offered).
Core earnings remain strong, which will be further strengthened by the robust commissioning pipeline and green initiatives.
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