National Thermal Power Corporation Limited


Industry Profile  :  Power is one critical component for development of economy. Lack of availability of power is not sustainable for growth and development. India is one of the country having diverse source of natural resource like Water, Coal, Lignite, Natural Gas, Oil, Nuclear power, wind which also help development of power sector. Electricity demand in the country has increased rapidly and is expected to rise further in the years to come. In order to meet the increasing demand for electricity in the country, massive addition to the installed generating capacity is required.  India ranks third among 40 countries in EY’s Renewable Energy Country Attractiveness Index, on back of strong focus by the government on promoting renewable energy and implementation of projects in a time bound manner and moved up 73 spots to rank 26th in the World Bank’s list of electricity accessibility in 2017.

Power sector in india is undergoing a significant change that has redefined the industry outlook. Sustained economic growth continues to drive electricity demand in India. The Government of India’s focus on attaining ‘Power for all’ has accelerated capacity addition in the country. At the same time, the competitive intensity is increasing at both the market and supply sides (fuel, logistics, finances, and manpower).

Total installed capacity of power stations in India stood at 330,260.53 Megawatt (MW) as on May, 2017. The Ministry of Power has set a target of 1,229.4 billion units (BU) of electricity to be generated in the financial year 2017-18, which is 50 BU’s higher than the target for 2016-17. The annual growth rate in renewable energy generation has been estimated to be 27 per cent and 18 per cent for conventional energy.

The Government has added 10.2 Giga Watts (GW) of conventional energy generation capacity and 12.5 GW of renewable energy capacity in Financial Year 2017. Under the 12th Five Year Plan, the Government has added 93.5 GW of power generation capacity, thereby surpassing its target of 88.5 GW during the period.

Company Profile   :   The company is indias largest energy producer, not only from thermal but also Hydro, nuclear, solar, wind etc. The company has 17.73% of the total national capacity. It contributes 24% of total power generation. The total installed capacity of the company is 51,635 MW (including JVs) with 20 coal based,  7 gas based stations, 1 Hydro based station and 1 Wind based station. 9 Joint Venture stations are coal based and 11 Solar PV projects. The Company has approximately nine joint venture stations, which are coal-based.  The Company’s Other business includes providing consultancy, project management and supervision, re-gasification, oil and gas exploration and coal mining.

Shareholding Pattern  : Govt of India, promoter hold 69.74%. Mutual Funds hold 3.71% ICICI mutual funds is among largest with 1.58%. 10.24% held by Foreign investor. 12.76% held by Financial institutions out of which large part is LIC. Ex LIC 0.51% is held by Insurance Companies. Remaining is held by public.

Financials and Ratios  :  

 2010-112011-122012-132013-142014-152015-16
Revenue57,407.3064,830.6568,775.5174,707.8275,362.3771,770.50
Net profit9,102.599,223.7312,619.3910,974.7410,290.8610,242.91
Net Profit Margin16.5314.8619.2115.2314.0414.52
EPS111115131212.42
Book Value82.3488.8997.49104.0899.03107.67
Dividend per share3.804.005.755.752.503.35
Dividend Payout34.4235.7537.5743.2020.0326.96
ROE13.4012.5815.6912.7812.6011.53
ROCE8.147.469.117.116.175.66
ROA7.236.547.836.115.224.77
Debt to Equity0.59 0.630.660.730.960.97
Asset Turnover43.7944.0640.7640.1037.1632.85

Future Prospects  :  As a Public sector company, NTPC was going through many different issues. State electricity distribution board, Power theft, Distribution network, dues from State board, uncertainty about future demand, stagnant capacity, commercialisation of new  units. addition of new capacity. But Looks like Company is trying to solve all this issues. that is why the stock price is showing sign of big move after long consolidation. Defiantly a Good company to buy.

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About Ashutosh

Tracking Indian Capital Market since 2014. Finance Student, Love to write about Finance and investing