This PSU stock is Nuvama's top pick after Q4 results; 93% of analysts tracking it agree

Shares of NTPC Ltd. is a near-consensus "buy" among the 28 analysts that track the stock after its fourth quarter results. 26 of those have a "buy" rating on the stock, while one each have a "hold" and "sell" rating.

NTPC Is Nuvma's "Top Pick"

Brokerage firm Nuvama cited the state-run company as its "top pick" and also raised its price target on the stock to ₹445 from ₹409 earlier.

The brokerage said that NTPC is its top pick given the steady-state 16-17% core RoE and a 9.4% adjusted consolidated EPS Compounded Annual Growth Rate (CAGR) expectation over financial year 2026-2028.

Nuvama also said that at 1.7 times its financial year 2028 estimated price-to-book value, the stock's valuations are inexpensive.

CLSA

The brokerage has an "outperform" rating on NTPC with a price target of 459 apiece.

It said the company's FY26 recorded PAT (consolidated) increased 18% despite a decline in its generation. Meanwhile, its peer JSW was in losses and Adani Power's recurring profit before tax (PBT) was down 4%.

It said the FY26 consolidated PAT was up 18%, driven by regulated equity growth of 11%, operational efficiency with a 17 basis points rise in coal PAF and a supportive FY25-29 regulatory regime for energy security.

The key was its $31 billion capex plan over FY27-29, led by under construction of 19 GW in regulated and 15 GW of non-fossil projects for an installed 89 GW, plus its entry into battery energy storage system (BESS), CLSA said.

The company now has 59% of its 60 GW NFE vision operating or under construction, solidifying its transition path. CLSA expects PAT growth to drive up its return on equity by 130 basis points for FY26-29.

Jefferies

The brokerage has a "buy" rating and a price target of ₹470 apiece on NTPC.

Jefferies said NTPC did a one-time remeasurement of deferred taxes in the March quarter. Hence, its annual numbers are not comparable.

The brokerage has raised its earnings per share (EPS) estimates for FY27-28 by 6% - 8% to factor the beat.

The management has retained its estimate of 9.6 GW for FY27 addition guidance but lowered its estimates for FY28 from 10.6 GW to 10 GW. It has also lowered its estimate for FY27-29 addition to 8.1-10.2 GW from 9.1-12.1 GW.

Its capacity ramp-up is a key re-rating driver ahead, Jefferies added.

NTPC In Q4

For the March quarter, NTPC's revenue of ₹43,110 crore, was 1.8% below estimates of ₹43,903.7 crore. Its EBITDA increased by 11.1% to ₹12,503 crore, compared to street estimates of ₹11,254.9 crore.

The company's margins expanded to 29%, while the street was working with a figure of 25.6%.

Guidance

The company, in its post-earnings conference call, guided for its total capacity addition for FY27 to be at 9,557 MW.

This includes 1,070 MW for thermal, 250 MW for hyrdo and 8,237 MW for renewable (including 176 MW from standalone; rest via joint ventures and subsidiaries).

The company has guided for ₹40,000 crore to ₹45,000 crore capex for FY27.

Stock reaction

Shares of gained fell 1.4% from their opening high of ₹391.95 apiece, following which they gained to the same level to hit an intraday high of ₹392.8 apiece on Monday. The stock has declined 4.9% in the past month but has gained 15.9% this year, so far.

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