ET NEWS

ET Intelligence Group: Shares of NTPC have risen around 12% over the past three months compared with the 2.9% gain in the ET Power index. Investors are betting on the company's capacity addition and green energy initiatives amid potential future demand. India's largest power generator has an installed capacity of nearly 86 gigawatt (GW) as of December 2025 and nearly 33 GW under construction. It plans to add 6.5 GW of new thermal capacity while accelerating renewable additions through its subsidiary NTPC Green Energy (NGEL). It is also ramping up investments in energy storage and nuclear technologies under the SHANTI Act. Of the total 33 GW currently under construction, about 16.5 GW is coal-based, 1.9 GW is hydro, and roughly 15 GW comprises renewable projects. According to the company management, the company expects the 1,350 megawatt (MW) Sinnar Thermal Power Plant acquisition to close shortly following approval of the resolution plan submitted by NTPC and Maharashtra State Power Generation Company by the National Company Law Tribunal (NCLT). The acquisition will also bring nearly 1,600 acres of land for future growth. The company's green-energy arm NGEL has commissioned 2.6 GW so far in FY26 and is likely to complete another 2.5 GW, in line with the target of 5 GW for the year. The subsidiary has a capacity-addition target of 8 GW each in FY27 and FY28. NGEL's Power Purchase Agreement tie-ups remain strong at 82% for FY26, 83% for FY27, and 60% for FY28, with an overall 74% PPA coverage across its around 20 GW pipeline.128231492 The company is simultaneously ramping up its presence in energy storage. It is in the final stages of evaluating a 5 GWh of battery energy storage system (BESS) across 16 stations under Section 62 where BESS projects are awarded with regulated tariffs approved by regulators, rather than through competitive bidding. It has also finalised a 320 MWh BESS project in Kerala. In hydropower storage, the third unit of the Tehri pumped-storage project has been commissioned, with the final 250 MW unit scheduled before FY26 ends. Preliminary studies are also underway for around 13 GW of pumped-storage projects allocated by various states. Analysts have retained 'buy' rating with 10-15% higher target prices than the current market price of ₹367. "NTPC continues to make efforts to diversify its generation portfolio. Progress on execution of new thermal projects remains a key variable to monitor," noted JM Financial Institutional Securities in a report. The broking firm has revised the target price to ₹420 from ₹397 earlier.

Mumbai: Analysts are mixed about recommending retail investors to participate in BHEL's ₹4,422 crore offer for sale (OFS), with views split between caution over valuation and orderbook optimism. Brokerages broadly agree that investors with a medium to long term horizon may find merit in bidding in the share sale. Short term investors, however, are unlikely to see any immediate upside, with the OFS itself not expected to serve as a near term rerating catalyst. The retail tranche of the two day share sale will open for bids on Thursday after the non retail portion was subscribed 2.3 times on Wednesday, the first day of the issue. Bids were placed for more than 22 crore shares against the 9.4 crore on the block, prompting the government to activate the green shoe option. The stock fell 5.6% to ₹260 on Wednesday after the floor price was set at ₹254 per share compared with its Tuesday closing price of ₹276, implying an approximate 8% discount. JM Financial said the floor price in the OFS valued the stock attractively, and maintained a buy rating with a target price of ₹355 per share, valuing the company at 30 times FY28 estimated earnings. The government is offloading up to 5% of its stake in BHEL via the two day OFS. Post the stake sale, the government will hold 58.17% in the company. "The OFS appears more of a divestment exercise than a fundamental rerating trigger," said Divyam Mour, research analyst at Samco Securities. "While the offer appears optically attractive, valuation and execution realities warrant careful consideration. We recommend only staggered participation for long term investors." BHEL's order book has swelled from ₹89,813 crore in FY21 to ₹2,19,600 crore in H1FY26, lifting its book to bill ratio to 7.2 times amid a revival in thermal and infrastructure capex, he said. "At a trailing P/E (Price to Earnings) ratio of 108 times, the stock is pricing in meaningful operating leverage, sustained order inflows, and structural improvement in profitability," said Mour. BHEL shares have risen over 30% in the past year, as against the 17% advance in the BSE Capital Goods Index. Vinod Nair, head of research at Geojit Investments, said the OFS is attractive for retail investors on a long term basis. "The stock is currently trading at a 1-year forward P/S (Price to Sales) of 2.2 times, near its three-year average. valuations remain compelling. We maintain a positive long-term stance on the stock," he said.