President of India-Backed Thermal Power Company Incorporated A JV Subsidiary With ONGC For Exploring & Setting Up Renewable Energy Projects

The stock is up by 54 per cent from its 52-week low of Rs 247.30 per share and gave multibagger returns of over 170 per cent in 3 years.

NTPC Ltd informed that ONGC NTPC Green Private Limited (ONGPL), a 50:50 joint venture between NTPC Green Energy Limited (NGEL) and ONGC Green Limited (OGL), was incorporated on November 18, 2024. With an authorized share capital of Rs. 10 lakh and a subscribed and paid-up capital of Rs. 10 lakh, ONGPL is poised to explore and develop renewable energy (RE) projects, both domestically and internationally. The company's primary focus is on greenfield development and acquisitions of RE assets, including offshore wind projects. Additionally, ONGPL will explore opportunities in energy storage, electric mobility, and ESG-compliant projects.

The formation of ONGPL has been approved by the Ministry of Power, Government of India. NGEL has subscribed to 50,000 equity shares at a face value of Rs. 10 each, resulting in a 50% stake in the joint venture. By combining the strengths of NTPC and ONGC, the partners aim to accelerate India's transition to clean energy. ONGPL's establishment signifies a strategic move towards a sustainable future and underscores the growing importance of renewable energy in India's energy mix.

Earlier, the company has formalized a joint venture with Rajasthan Rajya Vidyut Utpadan Nigam Limited (RVUNL) on November 4, 2024. This partnership will see the establishment of a 50:50 joint venture company to assume ownership and operational control of RVUNL's 2320 MW Chhabra Thermal Power Plant. Additionally, the agreement sets the stage for exploring potential expansions of the power plant's capacity. Furthermore, NTPC has approved a significant investment of Rs 79,738.45 crore for the expansion of three thermal power projects in India, including the Telangana Super Thermal Power Project, Phase-II, Gadarwara Super Thermal Power Project, Stage-II, and Nabinagar Super Thermal Power Project, Stage-II. These expansions will collectively add a substantial 11,200 MW to NTPC's power generation capacity.

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 3 lakh crore and reported positive numbers in its financial results (Q2FY24 & FY24).  The company has been maintaining a healthy dividend payout of 40 per cent.

The stock has a PE of 18x whereas the sectoral PE is 37x with an ROE of 14 per cent and an ROCE of 11 per cent. The stock is up by 54 per cent from its 52-week low of Rs 247.30 per share and gave multibagger returns of over 170 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.