Power Grid Corporation of India Ltd. share price target

Total capitalisation at the consolidated level was at | 1466 crore while that for the TBCB projects was at | 49 crore. Going ahead, the company has guided for capitalisation and capex of | 20000-25000 crore and | 15000 crore at consolidated level, respectively. The key risk emanates from guidance of capitalisation rests on the execution of Raighar Puglur HVDC project (| 9000 crore or 45% of capitalisation target) in H2FY20. If this slips that will risk capitalisation for FY20. We believe this is significant moderation compared to capacity addition and capex done over FY12-18. The impact on the lower...

Inline Q1, good defensive stock; Maintain Buy PGCILs Q1FY20 results were in line with our estimates. The capex was `29bn and capitalization was ` 14.7bn in Q1. PGCIL is a good defensive stock, with growth built in by the strong capitalization, which has reached a peak in recent years. This should lead to stronger cash flows. It has maintained capex and capitalization guidance given in the beginning of the...

EBITDA grew 24%YoY to Rs83bn, while EBITDA margin rose 160bps YoY to 84.5% due to decline in employee cost. PAT of TBCB companies increased Rs1.5bn YoY to Rs1.9bn in FY19 on commissioning of three projects and a weaker base....

Q4FY19 results ahead of estimates; good defensive stock; maintain Buy PGCILs Q4FY19 results were more than our estimates, as year-end accounting adjustments contributed to PAT. PGCIL is a good defensive stock, with growth built in by the strong capitalization, which has peaked in recent years, leading to stronger cash flows. Given lower capex guidance in FY20, we trim our FY20/21 sales and earnings estimates by 4-6%. The regulatory overhang has also passed, with the CERC retaining RoEs at...

4QFY18. FY19 capitalization stood lower at Rs192 bn compared to Rs260 bn in FY18. For FY20, management guided for lower consolidated capex Rs150 bn (FY19 258 bn) and capitalization of Rs200-250 bn which will be mainly due to Raigarh-Pugalur 800 project. Total works in hand stood at Rs610 bn (TBCB Rs90 bn) and management indicated opportunity worth Rs190 bn in FY20 which is mainly coming from Green Energy Corridor (Rs93 bn Interstate and Rs97 bn Intrastate). We expect company to announce higher dividend payouts due to lower capex guidance (45% in FY19 vs 35% in FY18). We have...

4QFY19 standalone (S/A) reported PAT grew 52% YoY to INR30.5b, boosted by prior-period sales and other likely one-offs on annual tariff adjustments. For FY19, S/A reported PAT rose ~21% YoY to INR99.4b even as gross block (proxy for regulated equity) grew by ~12% YoY. The growth was aided by prior-period revenue of ~INR2.8b and other one-offs. S/A capitalization stood at INR192b in FY19 (INR64b in Q4FY19) v/s INR273b in the previous year. Group capitalization stood at INR258b. PAT of TBCB companies increased INR1.5b YoY to INR1.9b in FY19 on...

Net revenue from Transmission business, which constitutes around 96% of total revenue, was up 13% to Rs 8271.85 crore and PBIT and the same was up by 11% to Rs 4762.62 crore with PBIT margin at 57.6%. Net revenue from consultancy service business which constitute around 2% of total sales was up by 9% to Rs 156.08 crore and PBIT was lower by 15% to Rs 67.70 crore. Telecom income which constitutes around 2% of total sales was up by 13% YoY to Rs 8624.11 crore while PBIT was up by 38% to Rs 108.70 crore with PBIT margin at 55.4%. OPM was lower by 90 bps to 87.5% resulting OP being up by 12% to Rs 7409.83 crore. Other...

PowerGrid reported Q3FY19 results that were muted as the capitalisation rate was below expectations. Reported revenues came in at | 8417.2 crore vs. estimate of | 8621.1 crore. Transmission revenues were in line with estimates for Q3FY19, which grew 13% YoY. On the...

Central Electricity Regulatory Commission's (CERC) draft power tariff regulations aim to promote efficiencies like reduction in regulated equity of conventional power sector in India, with the proposed return on equity higher-than-expected at 15.5%. However, some suggested changes may face implementation challenges like formation of operating & maintenance expense escalation being below long term inflation and tightening of working capital by way of reduction in receivable days despite payment delays from discoms....

Power Grid Corporation of India Ltd. (PGC) is the Central Transmission Utility (CTU) of the country and a Navratna Company operating under Ministry of Power. It is headquartered in Gurugram and transfers almost half of all power generated in India. PGC is engaged in power transmission business with the responsibility for planning, implementation, operation & maintenance of inter-state transmission system, telecom, and consultancy. PGC was incorporated in 1989 under the name National Power Transmission Corporation Ltd. but the name was subsequently changed to its present name in 1992. The objective of PGC is to create a strong and vibrant national...