By NTPC shares continued to attract significant buying interest for the second consecutive session on Wednesday, as the stock surged nearly 3% to reach a fresh all-time high of ₹417.40 in morning trade on the BSE.
The stock opened the day at ₹413.70, higher than its previous close of ₹406.90, and quickly gained momentum, rising by 2.6% to hit its new peak. By 10:10 am, the stock was trading 2.5% higher at ₹417.10 per share. This upward movement in NTPC’s stock price coincided with a broader market uptick, as the benchmark Sensex rose 0.27% to 81,671 during the same period.
The recent rally in NTPC shares has been driven by a combination of factors, including positive investor sentiment following the company’s strong quarterly earnings and an optimistic outlook from brokerage firms.
On July 30, NTPC announced that the second and final phase of its Ayodhya Solar PV Project in Uttar Pradesh, with a capacity of 26 MW out of a total of 40 MW, has commenced commercial operations.
This development brings NTPC’s total installed and commercial capacity to an impressive 76,074 MW, further solidifying its position as a leader in the energy sector.
Over the past year, NTPC shares have been on a remarkable run, soaring nearly 94%, significantly outperforming the broader market. In comparison, the Sensex has gained 23% over the same period. This robust performance has been underpinned by the company’s consistent financial results and its aggressive expansion into renewable energy.
Last Saturday, NTPC reported a 12% year-on-year increase in consolidated net profit for the first quarter of FY25, totaling ₹5,506.07 crore, up from ₹4,907.13 crore in the same period last year.
The company’s total income for the quarter also rose by nearly 13% year-on-year to ₹48,981.68 crore, compared to ₹43,390.02 crore in the corresponding period a year ago. These strong financials have further fueled investor confidence in the stock, leading to continued buying interest.
Several top brokerage firms have also raised their target prices for NTPC shares in light of the company’s solid performance and future growth prospects. Nuvama Wealth Management, for example, has maintained a buy rating on the stock, increasing its target price to ₹458 from ₹435, representing a potential upside of 13% from the stock’s closing price on July 30.
The brokerage highlighted NTPC’s rising commissioning of both thermal and renewable energy projects in FY25–27 as key drivers of future growth, along with benefits from Central Electricity Regulatory Commission (CERC) incentives.
Axis Securities also reiterated its buy rating on NTPC shares, raising its target price to ₹450 from ₹420. The firm pointed to NTPC’s robust thermal assets, which provide strong cash flow visibility, as well as the company’s aggressive renewable capacity expansion.
Axis noted that NTPC’s ability to mobilize funds at a lower cost of debt, estimated at around 6%, gives it a competitive edge over private peers, allowing it to offer competitive tariffs for renewable energy.
ICICI Securities echoed this positive sentiment, maintaining a buy call on the stock with a target price of ₹495. The brokerage firm valued NTPC’s thermal business at 17 times its expected FY26 earnings per share (EPS) and its renewable energy portfolio at 12 times its FY26 EV/EBITDA.
ICICI Securities emphasized NTPC’s track record of timely execution of renewable energy projects, noting that the company has set a target of reaching 60 GW of renewable capacity by 2032. As of March 2024, NTPC has already locked in a capacity of 20 GW, with 3.5 GW operational and another 5 GW under construction.
On the technical front, analysts have noted favorable indicators for NTPC shares. Jigar S. Patel, Senior Manager of Equity Research at Anand Rathi Share and Stock Brokers, observed that NTPC’s stock had been consolidating within a range of ₹390-355 over the past six weeks, but recently broke out of this range on the weekly chart, signaling a potential upward trend.
The stock’s RSI on the weekly chart has moved into the overbought zone, surpassing the 70 mark, indicating strong bullish momentum.
As NTPC continues to expand its renewable energy portfolio and deliver strong financial results, investor sentiment remains positive, with analysts and brokerage firms maintaining a bullish outlook on the stock.
With further project commissions expected in the coming years, NTPC is well-positioned to capitalize on the growing demand for clean energy, making it a compelling bet for investors seeking long-term growth in the energy sector.
