NTPC Green Energy shares jump 14% post listing. Should you buy, sell or hold?

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Shares of NTPC Green Energy, the renewable energy subsidiary of India's power producer NTPC, surged by as much as 14% on their trading debut Wednesday, driven by investor optimism about the country's increasing clean energy demand.

At 12:27 p.m, the stock rose 12.4% to Rs 121.35, compared to the IPO price of Rs 108, giving the company a market value of Rs 1.02 trillion ($12.08 billion), exceeding its target valuation of $10.8 billion.


"As expected NTPC Green Energy listing was in line with flat debut. Valuations and subdued market mood justify the listing. For long-term investors, we believe NTPC Green Energy Ltd is a great opportunity to invest in a leading player in India’s renewable energy sector, backed by the formidable resources and expertise of NTPC Ltd as a long-term strategy only," said Prashanth Tapse, Senior VP (Research), Mehta Equities.

Tapse added, "With ambitious renewable energy targets, the company is well-equipped to capitalize on the increasing demand for sustainable energy solutions. NTPC Green's strategic expansion into green hydrogen, green chemicals, and battery storage further enhances its growth prospects, positioning it at the forefront of India’s energy transition."


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"Considering all the parameters, allotted investors should consider holding it for the long term despite short-term volatility in the markets. For non-allotted investors, we advise accumulating if the listing is around the issue price or even below," Tapse said.

Shivani Nyati, Head of Wealth at Swastika Investmart, said, "Despite the aggressive pricing based on the PE ratio, the company's long-term prospects in the renewable energy space make it a suitable option for patient investors with a long-term horizon, and we recommend holding it with a stop loss around Rs 110."

Meanwhile, Gaurav Garg, Research Analyst at Lemonn, said, "We would advise people who invested for short term gains to exit and book profits."

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The proceeds from the Rs 10,000 crore IPO will be used for investment in its wholly-owned subsidiary, NTPC Renewable Energy, for the repayment of debt, and for other general corporate purposes.

NTPC Green, a subsidiary of NTPC, is the largest renewable energy public sector enterprise (excluding hydro) in terms of operating capacity as of September 24 and power generation in FY24.

Its renewable energy portfolio encompasses both solar and wind power assets, with a presence across multiple locations in more than six states, helping mitigate the risk of location-specific generation variability. The operational capacity was 3,220 MW of solar projects and 100 MW of wind projects as of September 2024.

NTPC Green Energy’s revenue from operations has grown at a CAGR of 46.82%, from Rs 910.42 crore in fiscal 2022 to Rs 1,962.6 crore in fiscal 2024. Profit after tax grew at a CAGR of 90.75%, from Rs 94.74 crore in FY22 to Rs 344.72 crore in FY24.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)

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