NTPC's prospects appear robust, barring seasonal impact in August

Regulated players, RE and hydro players seem more attractive from the valuation standpoint than merchant power players

Power generation decelerated 4.7 per cent year-on-year (Y-o-Y) to 155 billion units (BU) in August 2024. This was the first downtrend in many years, albeit on a high base -- generation had increased 19 per cent Y-o-Y to 163 billion units (BU) in August 2023. The dip was partly due to excess rainfall, which pared cooling demand and also reduced need for irrigation.

Coal-based generation declined 5 per cent Y-o-Y to 101 BU. Plant utilisation factor for coal-thermal declined 464 bps in August 2024 to 63 per cent. Hydro-generation declined 2 per cent Y-o-Y to 24 BU