It’s all green for power stocks

Twesh Mishra New Delhi | Updated on January 27, 2018 Published on December 20, 2017

It was a ‘green’ year for the listed companies in the power sector.

Public sector power generator, NTPC, has had a turbulent year, but on the stock market its performance was decent. On January 1, 2017, NTPC’s shares opened at ₹164.80 and today the shares stand at ₹178.85 a piece. The company was also in the news for the wrong reasons. After being hit by coal shortage mid-year, NTPC’s Gorakhpur power plant was shut because of a boiler explosion killing 34 people. By end of the year, the company also saw its Director (Finance) being hauled up by the CBI for corruption.

For Power Grid Corporation, the year started with the news that the country’s central transmission utility will be procuring more drones for surveillance of transmission projects. As the year progressed, the firm started facing competition from Chinese companies for critical transmission projects.

While the government has not clarified its position, no major projects have been awarded to the Chinese after local manufacturers raised concerns to the Prime Minister’s Office. The Power Grid scrip remains a top pick of stock analysts, all hoping for an increasing demand for power transmission infrastructure. The Power Grid stock opened at ₹183.65 on January 1 andclosed at ₹203.25 on Wednesday.

However, NHPC’s performance was not much to talk about. NHPC’s share opened the year at ₹26.80 a share and closed today at ₹28.25. NHPC has added 130 MW to its installed capacity during the year with the commissioning of Unit III & IV (40 MW each) of Teesta Low Dam-IV Project (40 MW X 4) in West Bengal and 50 MW wind energy in Rajasthan. This is minuscule figure considering the 6,717 MW of completed projects in NHPC’s kitty.

For Tata Power, 2017 was a mixed bag. A May 2017 Motilal Oswal report had projected a 20 per cent dip in share value from the ₹84 a share then. Looking at the current closing price, the share has unquestionably outperformed.

This is because the company has increased its footprint in renewable energy as the charm of thermal power has faded. But it has not been an easy year for the company. In April, the Supreme Court had disallowed compensatory tariff for the company’s ultra mega power project in Gujarat. Tata Power’s shares opened at ₹75.40 a piece on January 1 and closed today at ₹90.85.

NLC India had a good run at the market. It’s share opened at ₹77.95 on January 1 and closed today at ₹105.90 per share.

Published on December 20, 2017

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