NTPCGREEN - Investment Analysis: Buy Signal or Bull Trap?
Back to ListInvestment Rating: 2.8
| Stock Code | NTPCGREEN | Market Cap | 73,165 Cr. | Current Price | 86.9 ₹ | High / Low | 118 ₹ |
| Stock P/E | 142 | Book Value | 22.2 ₹ | Dividend Yield | 0.00 % | ROCE | 6.42 % |
| ROE | 3.95 % | Face Value | 10.0 ₹ | DMA 50 | 92.4 ₹ | DMA 200 | 100 ₹ |
| Chg in FII Hold | -0.18 % | Chg in DII Hold | 0.17 % | PAT Qtr | 60.3 Cr. | PAT Prev Qtr | 86.0 Cr. |
| RSI | 39.6 | MACD | -1.59 | Volume | 59,85,181 | Avg Vol 1Wk | 81,47,174 |
| Low price | 84.0 ₹ | High price | 118 ₹ | Debt to equity | 0.42 | 52w Index | 8.47 % |
| Qtr Profit Var | -32.6 % | EPS | 0.61 ₹ | Industry PE | 25.5 |
📊 Analysis: NTPCGREEN shows weak fundamentals with ROE at 3.95% and ROCE at 6.42%, indicating poor efficiency. The stock trades at an extremely high valuation with a P/E of 142 compared to the industry average of 25.5, making it significantly overvalued. Dividend yield is 0%, offering no income support. Debt-to-equity at 0.42 is moderate but manageable. Technical indicators (RSI ~39.6, MACD negative) suggest weak momentum, with price below both 50 DMA (92.4 ₹) and 200 DMA (100 ₹). Quarterly PAT has declined sharply (86 Cr. → 60.3 Cr., -32.6%), raising concerns about earnings stability. Overall, the stock is not a strong candidate for long-term investment unless profitability improves substantially.
💰 Ideal Entry Zone: A cautious entry would be in the range of 75 ₹ – 82 ₹, closer to long-term support levels, only for high-risk investors willing to wait for a turnaround.
📈 Exit / Holding Strategy: If already holding, consider reducing exposure or exiting on rallies near 95–105 ₹. Long-term holding is risky given weak ROE/ROCE, high valuations, and declining profits. Investors should only hold if confident in renewable energy sector growth and NTPCGREEN’s ability to improve profitability over the next 3–5 years.
✅ Positive
- Large market cap (73,165 Cr.) ensures scale and visibility.
- DII holding increased (+0.17%), showing limited domestic institutional support.
- Debt-to-equity ratio (0.42) indicates moderate leverage.
⚠️ Limitation
- Extremely high P/E (142) compared to industry average (25.5).
- Weak ROE (3.95%) and ROCE (6.42%) highlight poor efficiency.
- No dividend yield (0.00%), offering no income support.
- Weak technical momentum (RSI low, MACD negative).
📉 Company Negative News
- Quarterly PAT declined sharply (-32.6%).
- FII holding decreased (-0.18%), showing reduced foreign investor confidence.
📈 Company Positive News
- DII holding increased (+0.17%), reflecting some domestic support.
- Volume activity remains strong, indicating liquidity in the stock.
🏭 Industry
- Industry P/E at 25.5 indicates sector is moderately valued compared to NTPCGREEN’s premium.
- Renewable energy sector expected to benefit from government initiatives and long-term demand growth.
🔎 Conclusion
NTPCGREEN is currently a weak candidate for long-term investment due to poor efficiency metrics, declining profits, and extremely high valuations. Ideal entry is only for high-risk investors (~75–82 ₹). Existing holders should consider exiting near resistance levels (95–105 ₹) unless confident in a turnaround driven by renewable energy growth. Long-term investors should monitor profitability improvements before committing further capital.