Shares of NTPC Ltd. gained 5% to hit a record high on Tuesday after the company was shortlisted as 'top pick' by Citi Research among electric utilities following the release of strong first-quarter results.
The power-generation company's consolidated net profit rose 12% to Rs 5,506 crore in the quarter ended June 2024, according to an exchange filing. Analysts polled by Bloomberg had a consensus estimate of Rs 5,289.8 crore.
The brokerage maintains a 'buy' rating on the stock and a target price of Rs 467, implying a potential upside of 18.4% from the previous close.
NTPC Q1 Results: Key Highlights (Consolidated, YoY)
Revenue up 13% to Rs 48,521 crore. (Bloomberg estimate: Rs 46,055.5 crore).
Ebitda up 9% to Rs 14,017 crore. (Bloomberg estimate: Rs 13,698.1 crore).
Ebitda margin at 28.9% versus 29.8% (Bloomberg estimate: 29.7%).
Net profit up 12% to Rs 5,506 crore. (Bloomberg estimate: Rs 5,289.8 crore).
"Management outlined multiple avenues of growth, ranging from growth in thermal capacity, foray into nuclear power generation, renewable energy and start of construction of new hydroelectric plants by subsidiaries," Citi said in a note. "Despite stock price outperformance, NTPC’s valuation is reasonable, in our view, with reasonable returns-on-equity and an improving growth profit," Citi said.
Shares of NTPC rose as much as 4.77% in early trade to Rs 412.7 apiece on the NSE. It was trading 3.81% higher at Rs 408.90 per share, compared to a 0.1% advance in the benchmark Nifty at 12:18 p.m.
The stock has gained 30.5% on a year-to-date basis and 85.9% in the last 12 months. At 12:18 p.m., it contributed 16 points to the rise 99-point rise in the Nifty 50.
The total traded volume on the NSE so far in the day stood at 0.94 times its 30-day average. The relative strength index was at 67.8.
Out of the 35 analysts tracking the company, seven have a 'buy' rating on the stock, 13 recommend 'hold' and 15 suggest a 'sell', according to Bloomberg data. The average of 12-month analyst price targets implies a potential downside of 12.6%.
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