Wednesday, May 11, 2011

Result Flash - NTPC - 4QFY2011 - Buy

Dear All,

Forwarding you the Result Flash on NTPC for 4QFY2011 with a Buy recommendation and a Target Price of `209 (12 months).

NTPC’s audited results for 4QFY2011 was much better than the provisional results declared by the company earlier. The company’s standalone net sales rose by 25.6% yoy during the quarter to `15,519cr, higher than our estimates of a 12.2% growth. The growth in top-line during the quarter was aided by grossing up of the RoE under the normal tax rate for FY2011 instead of the MAT rate. The company had grossed up its RoE under the MAT rate during 9MFY2011. The growth in top-line is also on account of higher fuel cost, which is a pass-on. Despite the increase in capacity on yoy basis, the company’s generation volumes remained flat during the quarter on yoy basis on account of low PLF. The operating profit rose by 40.6% yoy during the quarter to `4,279cr. The net profit for the company rose by 37.9% yoy to `2,782cr.

For FY2011 as a whole, the company posted a 18.5% yoy increase in standalone net sales to `54,874cr. The OPM was down by 213bp yoy and stood at 28.8%. Fuel costs rose by 20.1% during the year. On the Bottom-line front, the net profit rose 4.3% during the year to `9,103cr. We recommend a Buy on the stock with a target price of `209.

Exhibit: 4QFY2011 Actual v/s Angel estimates

 

(Rs cr)

Actual

Estimates

Variation (%)

Net Sales

   15,519

    13,835

12.2

Operating Profit

     4,279

      3,785

13.1

OPM (%)

       26.8

        27.4

(58)bp

Rep. Net Profit

     2,782

      2,216

25.5

Source: Company, Angel Research

Exhibit: 4QFY2011 Performance

 

Y/E March (Rs cr)

4QFY2011

3QFY2011

% Chg

4QFY2010

% Chg

FY2011

FY2010

% Chg

Net Sales

   15,519

     13,421

15.6

   12,353

25.6

  54,874

   46,323

   18.5

Other Operating Income

       461

         543

(15.1)

       365

26.3

   3,486

     1,882

   85.2

Total Operating Income

   15,980

     13,964

14.4

   12,718

25.6

  58,360

   48,205

   21.1

Fuel Cost

       9,726

          8,339

16.6

       8,346

16.5

    35,374

      29,463

      20.1

(% of Sales)

               63

                   62

 

                68

 

              64

                64

 

Staff Costs

          708

             689

2.9

          746

(5.0)

      2,790

        2,412

      15.6

(% of Sales)

                  5

                     5

 

                  6

 

                5

                  5

 

Other Expenses

       1,266

             636

99.0

          582

117.4

      4,400

        2,011

    118.8

(% of Sales)

       




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