More steam left in NTPC stock; to be key beneficiary of rising power demand

NTPC has a healthy return on equity (RoE) of 14-15 per cent and a likely revenue compound annual growth rate of 15 per cent through FY25

Power demand in summer is liable to spike very sharply due to expectations of higher economic activity and also, projections of high cooling demands since it is expected to be a very hot summer. As India’s largest generator, the public sector undertaking NTPC would be a key player.

Power generation surged 13.8 per cent year-on-year (YoY) in February 2023 after rising 18.4 per cent YoY in January 2023 and 14.3 per cent YoY in December 2022. But power generation fell in February by 6.6 per cent month-on-month (MoM), due to an increase in temperature (leading to lower need for heating).