President of India-Backed Power Generation Company Inks JV Agreement with MAHAPREIT for Development of 10 GW RE Projects

The stock is up by 94 per cent from its 52-week low of Rs 227.75 per share and gave multibagger returns of over 250 per cent in 3 years.

NTPC Green Energy Limited (NGEL), a wholly-owned subsidiary of NTPC Limited, is making significant strides in the renewable energy sector. The company recently inked a Joint Venture Agreement (JVA) with Mahatma Phule Renewable Energy and Infrastructure Technology Ltd. (MAHAPREIT) to develop 10 GW of Renewable Energy Parks and Projects in Maharashtra or other Indian states. This strategic partnership aligns with NGEL's commitment to expanding its renewable energy footprint and contributing to India's sustainable energy goals.

In addition to the JVA with MAHAPREIT, NGEL has also secured investment approvals for two new superthermal power projects. The Darlipali Super Thermal Power Project, Stage-II (1x800 MW), and the Sipat Super Thermal Power Project, Stage-III (1x800 MW), have been approved by the company's Board of Directors. These projects demonstrate NGEL's continued focus on traditional power generation while also investing in renewable energy.

To further strengthen its financial position and support its growth initiatives, NGEL is planning an Initial Public Offer (IPO). The company has filed a Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI), seeking to raise up to Rs 1,00,000 million through the sale of equity shares. The IPO is expected to provide NGEL with the necessary capital to fund its expansion plans and enhance its market presence.

About the Company

NTPC (National Thermal Power Corporation) Ltd along with its subsidiaries/ associates & JVs is primarily involved in the generation and sale of bulk power to state power utilities. The President of India owns the majority of the stake (51.10 per cent). Talking about the financials, NTPC Ltd has a market cap of over Rs 4 lakh crore and reported positive numbers in its financial results (Q1FY24 & FY24).  The company has been maintaining a healthy dividend payout of 40 per cent.

On Friday, shares of NTPC Ltd surged 1.60 per cent to make a new 52-week high of Rs 441.30 per share from its previous closing of Rs 434.40 per share. In the recent trading session, the stock is hitting back-to-back 52-week highs.

The stock has a PE of 20x whereas the sectoral PE is 40x with an ROE of 14 per cent and an ROCE of 11 per cent. The stock is up by 94 per cent from its 52-week low of Rs 227.75 per share and gave multibagger returns of over 250 per cent in 3 years. Investors should keep this PSU stock under the radar.

Disclaimer: The article is for informational purposes only and not investment advice.