Shares of state-owned company National Thermal Power Corporation Limited (NTPC) were trading as top gainers on BSE in Friday's early trading session after global research firm CLSA maintained buy call on the stock. The company has started leading the Renewable Energy (RE) space, winning 44% of 1.1 GW in tenders.
CLSA retained buy call on the stock with a target price of Rs 140 per share, on the back of its improving ESG, deep-value multiples, and high yield. The brokerage believes that the win should improve the visibility of the company's beating its 30% non-fossil target.
The win should add 9% to the company's RE portfolio and could earn 11.4% equity IRR, it later added.
Following the update, the NTPC stock opened at Rs 96 and later gained 3.08% today to hit an intraday high of Rs 92.1 against the last close of Rs 94.10. However, NTPC shares also hit an intraday low of Rs 94.50.
Market capitalisation of the firm stood at Rs 93,553 crore as of today's session. NTPC stock price is trading higher than 5, 20, 50, 100, and 200-day moving averages.
NTPC share price has also seen buying interest on the back of the scheduled buyback offer next month. The state-run conventional power generation firm's nearly buyback worth Rs 2,276 crore will open on December 07 and will close on December 18, 2020. The floor price of Rs 115 per share has been fixed for the buyback.
NTPC's buyback offer comprises 19,78,91,146 equity shares having a face value of Rs10 each representing 2% of the total number of equity shares in the issued, subscribed, and paid-up equity share capital of the company.
NTPC stock has gained over 11% in the last 2 days of straight gains. The stock value has gained 5.7% in one month. Although, the stock price has erased 20% since the beginning of the year and 18% in one year.
"The Buyback would help in optimization of the capital structure and improving return on equity, by a reduction in the equity base, thereby leading to long term increase in shareholders value," NTPC had said earlier in a regulatory filing.
In the first week of November, the company reported a 7.43% year-on-year (YoY) growth in net profit at Rs 3,504 crore for the quarter ended September on account of exceptional gains of Rs 560.43 crore, on the back of exceptional gains and higher revenues. The company's revenue from operations rose 8.40% to Rs 24,677.14 crore.
As per media reports, NTPC, one of the biggest thermal power producers in the world, also plans to acquire at least 1,000 megawatts (MW) of operational wind power projects, after which the firm may rank among the largest in India's clean energy sector.
Reportedly, NTPC is also working on the acquisition of at least 1 gigawatts (GW) of operational solar power projects from promoters, lenders, or merchant bankers.
In another update, South Delhi Municipal Corporation (SDMC) and NTPC have signed a memorandum of understanding (MoU) to install solar systems on over 200 SDMC buildings to save on power bills and generate revenue.