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Informist, Friday, Oct. 18, 2024

 

By Anand JC

 

MUMBAI – NTPC Ltd. is expected to have benefitted from an increase in regulated equity from thermal capacity additions in the September quarter, analysts said. However, the company is expected to report a revenue growth of only 3% as lower temperatures during the quarter due to excess rains resulted in lower demand for power, analysts said.

 

The state-owned company is expected to report a standalone net profit of INR 43.33 billion for the September quarter, according to an average of estimates from six brokerage firms. While the bottom line is seen up 11.54% on year, it is seen down 4% sequentially. NTPC had reported a net profit of INR 38.85 billion in the same quarter last year but this included prior period sales of INR 6.20 billion. Excluding this one-off, NTPC's net profit was INR 34.98 billion. For the trailing June quarter, NTPC had reported a net profit of INR 45.11 billion.

 

NTPC's net profit for the latest quarter is expected to be boosted by a 9% on-year increase in regulated equity which is estimated at INR 885 billion for the quarter. Regulated equity in the June quarter had risen 13% on year to INR 886 billion. Standalone revenue for the September quarter is expected to be INR 420.17 billion, an average of six analyst estimates showed. NTPC's top line is seen increasing 2.8% on year, but dropping 5.4% sequentially. Analysts expect NTPC to see weaker generation and sales in the latest quarter.

 

Power demand in the September quarter was almost flat at 435 billion units. This was because of 37?ove normal rainfall in states that account for 75% of India's power demand. On a standalone basis, NTPC's power generation is expected to have risen 1% on year to 84 billion units in the September quarter, Elara Securities (India) Pvt Ltd. wrote in a report. NTPC's power generation had increased 10.6% on year in the June quarter.

 

NTPC's September quarter earnings before interest, tax, depreciation, and amortisation are seen at INR 116.73 billion, based on an estimate of five analysts. The company had reported EBITDA of INR 105.38 billion in the same quarter a year ago. While the EBITDA may increase 10.8% on year, it is expected to fall by 10.8% sequentially.

 

In the June quarter, NTPC's plant load factor for coal increased to 80.4%, hydro to 57.4%, and gas to 23.8%. "NTPC's growth in the September quarter will be supported by robust plant load factor performance, increase in standalone commercial capacity by 1.3 GW, robust consultancy and project management fees, and an overall increase in power generation," Motilal Oswal Financial Services Ltd. said in a report.

 

CAPACITY POWER

NTPC's energy assets include coal mines and coal-based, gas-based, and hydroelectric power stations. For the country's largest power generation company, the focus remains on capacity addition, analysts said. "In addition to the 9.6-gigawatt thermal capacity already under construction, NTPC will award another 15 GW in the near future. In the renewable space, there will be the commissioning of 20 GW renewable energy in the next three years," Antique Stock Broking Ltd. said in a note.

 

NTPC currently has an operational capacity of 76 GW. Out of this, 59 GW is at the holding company level while 17 GW is under its 16 joint ventures and 10 subsidiaries. The company has 62 GW of thermal capacity, 6.5 GW of gas capacity, 3.7 GW of hydro capacity, and 3.6 GW of renewable capacity.

 

The company transferred 15 renewable energy assets totalling 2.9 GW to NTPC Green Energy Ltd. in 2023. NTPC Green Energy is the third-largest renewable energy company after Adani Green Energy Ltd. and ReNew Power Pvt. Ltd. and it has recently filed a draft red herring prospectus for an initial public offer of shares. Outside of this wholly-owned subsidiary, NTPC currently holds 0.5 GW of renewable energy assets.

 

The date on which NTPC will announce its September quarter earnings is not yet known. On the National Stock Exchange, NTPC shares Friday ended at INR 424.95, up 1.7% from the previous close.

 

Following are the Jul-Sept earnings estimates for the company based on reports compiled by Informist Media from six brokerages:

Brokerage firm	Net sales (in mln rupees)	Net profit (in mln rupees)	EBITDA (in mln rupees)
Antique Stock Broking Ltd.	429,191	40,701	112,448
Elara Securities (India) Pvt Ltd	431,322	42,760	121,434
Kotak Institutional Equities	402,474	43,557	115,920
Motilal Oswal Financial Services Ltd.	416,934	46,131	119,503
Nuvama Wealth Management Ltd.	429,759	42,195	114,347
Sharekhan Ltd.	411,350	44,650	---
AVERAGE	420,172	43,332	116,730

 

End

 

Edited by Ashish Shirke

 

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