Fundamentals improving, but stake sale remains a major overhang for NTPC

Though growth in regulated equity led by capacity expansions will drive earnings, coal supplies impacted by monsoon can lead to rise in under-recoveries during September quarter

India’s largest power generating company, NTPC, remains in the news due to commissioning of its new capacities. As the company announced the start of Unit-1 (first of the two units of 800 megawatt, or Mw, each) of Lara Super Thermal Power Station (Chhattisgarh), the spotlight was shared by the start of a 660 Mw unit of India’s first ultra-supercritical power plant at Khargone, Madhya Pradesh (MP), on September 30.

The plant has higher efficiency, with coal supply from NTPC’s own mines in Jharkhand ensuring fuel safety. While the second unit of the plant is to be commissioned by February 2020,