Rs 2.50/Sh Dividend: Maharatna PSU Energy Stock NTPC To Ex-Dividend In Diwali; JM Says BUY For Rs 471/TP

Maharatna PSU energy stock, NTPC Ltd is going to turn ex-dividend in Diwali festival. The company has fixed November 2 as the record date to determine eligible shareholders for its upcoming dividend of Rs 2.50 per share. Brokerage JM Financial is the latest to like the stock, and has upgraded its target price to Rs 471 on NTPC.

According to JM Financial, NTPC's revenue for 2QFY25 stood at INR 447bn, -1%/ +1%/ -5%, YoY/ JMFe/ Cons due to decline of -1% in generation. The EBITDA came in at INR 117bn, -8%/ -8%/ -12% YoY/ JMFe/ Cons impacted by higher other expenses (+58% YoY, mostly ERV expenses). The adj. PAT jumped to INR 54bn, +14%/ +10%/ +7% YoY/ JMFe/ Cons on account of higher regulatory income (11x YoY). The plant load factor (PLF) for coal-fired plants stood at 72.28% vs. 75.83% in 2QFY24 driven by moderate energy/peak power demand (-1%/-5% YoY).

Given the revival in margin-accretive thermal capex (26GW capacity addition by FY32) and momentum in new growth areas viz. nuclear power (allotted 2.8GW) and coal mining (86MTPA capacity), JM Financial said, "we maintain our BUY rating on the stock with a revised TP of INR 471 valuing at 3x Sept FY27E Regulated Equity of thermal business and 12x Sept FY27E EBITDA of RE business."

In FY24, the company delivered 77.50% dividends worth Rs 7.75 per share. In 2024 alone, the company paid up to Rs 5.5 per share.

NTPC is India's largest power utility with a total installed capacity of 76,294 MW (including JVs). Established in 1975, NTPC is steering ahead to be India's largest integrated power company and targets to become a 130 GW firm by 2032.