⚠ Disclaimer: This report is generated using AI tools and is for informational purposes only. It does not constitute investment advice. Please consult a registered financial advisor before making any investment decisions.
NTPC - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 4.0
| Stock Code | NTPC | Market Cap | 3,66,923 Cr. | Current Price | 378 ₹ | High / Low | 394 ₹ |
| Stock P/E | 18.2 | Book Value | 173 ₹ | Dividend Yield | 2.21 % | ROCE | 12.2 % |
| ROE | 13.6 % | Face Value | 10.0 ₹ | DMA 50 | 365 ₹ | DMA 200 | 347 ₹ |
| Chg in FII Hold | -0.16 % | Chg in DII Hold | 0.26 % | PAT Qtr | 4,987 Cr. | PAT Prev Qtr | 4,653 Cr. |
| RSI | 53.8 | MACD | 5.58 | Volume | 1,10,14,600 | Avg Vol 1Wk | 1,83,02,421 |
| Low price | 316 ₹ | High price | 394 ₹ | PEG Ratio | 2.50 | Debt to equity | 1.11 |
| 52w Index | 79.7 % | Qtr Profit Var | 5.85 % | EPS | 20.8 ₹ | Industry PE | 30.0 |
📊 Financials
- Revenue & Profitability: PAT rose from ₹4,653 Cr. to ₹4,987 Cr. (+5.85%), showing steady growth. EPS at ₹20.8 is healthy.
- Margins & Returns: ROCE (12.2%) and ROE (13.6%) are moderate, reflecting stable efficiency.
- Debt: Debt-to-equity ratio of 1.11 indicates high leverage, typical for power utilities but adds risk.
- Cash Flow: Strong profitability supports liquidity, though debt servicing remains significant.
💹 Valuation
- P/E Ratio: 18.2 vs Industry PE of 30.0 → Undervalued compared to peers.
- P/B Ratio: ~2.18 (Price ₹378 / Book Value ₹173) → Reasonable valuation.
- PEG Ratio: 2.50 → Growth moderately justifies valuation.
- Intrinsic Value: Current price appears attractive relative to fundamentals.
🏢 Business Model & Competitive Advantage
- NTPC is India’s largest power producer, with diversified generation across thermal, hydro, and renewables.
- Competitive advantage lies in scale, government backing, and long-term contracts.
- Dividend yield of 2.21% provides steady shareholder returns.
📈 Entry Zone & Long-Term Guidance
- Entry Zone: Attractive near ₹350–365 range (close to DMA 200 at ₹347).
- Long-Term Holding: Strong candidate for long-term investors seeking stable dividends and exposure to India’s power sector growth.
✅ Positive
- Undervalued compared to industry peers (P/E 18.2 vs 30.0).
- Strong PAT growth (+5.85%) shows earnings momentum.
- Dividend yield of 2.21% supports investor confidence.
- DII holdings increased (+0.26%), showing domestic institutional support.
⚠️ Limitation
- High debt-to-equity ratio (1.11) increases financial risk.
- ROCE and ROE are moderate compared to industry leaders.
- PEG ratio of 2.50 suggests valuations are slightly stretched relative to growth.
📉 Company Negative News
- FII holdings reduced (-0.16%), showing cautious foreign sentiment.
- High leverage remains a concern for long-term sustainability.
📈 Company Positive News
- PAT improved sequentially, reflecting operational strength.
- DII holdings increased, signaling domestic confidence.
- MACD at +5.58 indicates bullish technical momentum.
🏭 Industry
- Power generation industry benefits from rising demand, government initiatives, and renewable energy expansion.
- Industry PE at 30.0 suggests peers trade at higher valuations, making NTPC attractive.
🔎 Conclusion
- NTPC is fundamentally strong with steady earnings, government backing, and attractive dividend yield.
- However, high debt and moderate return ratios limit aggressive upside.
- Best strategy: Accumulate near ₹350–365 range for long-term holding, focusing on dividend income and sector stability.