Hot Chips

Dalal Street Investment Journal - - CONTENTS -

The com­pany jointly pro­moted by NTPC, PFC, Power Grid and NHPC, is en­gaged in power trad­ing busi­ness with mar­ket share of 30per cent. Dur­ing Q4FY17, the com­pany posted 7.5per cent YOY growth in its long term trades to 363.3 crore units and

1.3per cent growth in short term trades to 586.4 crore units. How­ever, it op­er­ates in a very small mar­gin of 4-7 paise per unit. Hence, it is mulling to in­crease its share of long term PPA con­tracts to 50per cent. As for the fi­nan­cials, the com­pany posted 5per cent and 85per cent rev­enue and

PAT growth, re­spec­tively, dur­ing

Q4FY17. Fur­ther in FY17, it posted 10per cent and 25per cent rev­enue and PAT growth, re­spec­tively. Thereby, con­sid­er­ing its shift to­wards long term PPAS, we rec­om­mend a Buy in the scrip for a tar­get of ₹138 and with a stop loss of ₹112.

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