Mehabe score: 4 G Factor: 4 Piotski Score: 6 The stock has a rating HOLD. The mehabe team score is reflective of its fundamental and technical merits. A rating above 8 is considered good buy. The stock has a G-Factor of 4 and Piotski score of 6.
Description
NHPC is primarily engaged in the business of generation and sale of bulk power to various Power Utilities. Other business includes providing project management / construction contracts/ consultancy assignment services and trading of power.(Source : 202003-01 Annual Report Page No:141)Site:NHPC
Market Cap:
Rs 27,121 cr
Price:
27.0
Trading pe:
8.73x
Book-value:
32.8/share
Div yield:
5.55 %
Earning yield:
10.25%
Face-value:
10.0/share
52week high:
27.65
52week low:
19.40
Technical Analysis
Stock trades at 27.0, above its 50dma 25.23. It also trades above its 200dma 23.63. The stock remains bullish on techicals
The 52 week high is at 27.65 and the 52week low is at 19.40
Price Chart
P/E Chart
Sales and Margin
Strengths
– Stock is trading at 0.82 times its book value
– has been maintaining a healthy dividend payout of 55.35%
Weakness
– The company has delivered a poor sales growth of 4.01% over past five years.
-Tax rate seems low
– has a low return on equity of 8.51% for last 3 years.
-Contingent liabilities of Rs.12084.52 Cr.
– might be capitalizing the interest cost
-Debtor days have increased from 105.95 to 139.19 days.
-Promoter holding has decreased over last 3 years: -3.01%
Competition
– The industry trades at a mean P/E of 21.9x. Adani Green trades at the industry’s max P/E of 913.77x. NHPC trades at a P/E of 8.73x
– Industry’s mean G-Factor is 3.1 while the mean Piotski score is 8.0. NHPC has a G-Factor of 4 and Piotski scoreof 6.
– Average 1 month return for industry is 19.3%. The max 1- month return was given by Adani Power: a return of 55.66 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 1609.0 cr compared to Rs 2170.0 cr for period ended Mar 2020, a fall of 25.9%
Operating Profits reported at Rs 541.0 cr for period ended Mar 2021 vis-vis 454.0 for period ended Mar 2020 .
Operating Margins expanded 1270.2 bps for period ended Mar 2021 vis-vis Mar 2020 .
The EPS for Mar 2021 was Rs 0.43 compared to Rs 0.87 for previous quarter ended Dec 2020 and Rs 0.16 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 9648.0 cr for period ended Mar 2021 vis-vis sales of Rs 10008.0 cr for the period ended Mar 2020, a fall of 3.7%. The 3 year sales cagr stood at 7.6%.
Operating margins expanded to 55.0% for period ended Mar 2021 vis-vis 52.0% for period ended Mar 2020, expansion of 300.0 bps.
Net Profit reported at Rs 3257.0 cr for period ended Mar 2021 vis-vis sales of Rs 2875.0 cr for the period ended Mar 2020, rising 11.7%.
Company recorded a Net Profit CAGR of 9.0% over the last 3 years
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
Sales Growth
Profit Growth Statement
Profit Growth Statement
Stock Price CAGR
Return of Equity
General Comments
– The company has had stable/constant Return on Equity (RoE) metric. The RoE on Last Year basis was 9.0% compared to 9.0% over the last 3 Years. – The stock has given a return of 35% on a 1 Year basis vis-vis a return of 1% over the last 3 Years. – The compounded sales growth on a TTM bassis is 2% vis-vis a compounded sales growth of 5% over the last 3 Years. – The compounded profit growth on a TTM basis is -5% vis-vis a compounded profit growth of -1% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Mar 2021 fii holding stood at 4.04% vis-vis 3.98% for Dec 2020 – Public shareholding has remained largely constant. The Mar 2021 public holding stood at 10.12% vis-vis 10.56% for Dec 2020
Conclusion
– Stock is trading at 0.82 times its book value
– has been maintaining a healthy dividend payout of 55.35% – The company has delivered a poor sales growth of 4.01% over past five years.
-Tax rate seems low
– has a low return on equity of 8.51% for last 3 years.
-Contingent liabilities of Rs.12084.52 Cr.
– might be capitalizing the interest cost
-Debtor days have increased from 105.95 to 139.19 days.
-Promoter holding has decreased over last 3 years: -3.01%
The business fundamentals of the stock remain stable. Stronger near term results will build interest in the stock. We suggest to wait for a upturn in business performance.
Technically, the stock remains above its 50 DMA 25.23 and is trading at 27.0, thus bullish price action wise.
