NTPC Offer For Sale - Subscribe - Microsec

NTPC Ltd, Maha Ratna Company, was incorporated by government of India in 1975 as central thermal based power generation utility. It is the largest power generator in India with an installed capacity of 39.2GW and contributes 30% of the electricity generation in India.

Government of India has cleared the proposal to disinvest a 9.5% stake in NTPC. The sale in NTPC of around 78.3 Cr shares is likely to be through the offer for sale (OFS) route and could fetch the government close to Rs 120 bn.

Post the announcement of divestment, the stock has corrected 10%. At these levels, valuations are reasonable coupled with recent positive developments such as its proposed FSA with CIL, restoration of its coal block augur well for the company.

We recommend a "SUBSCRIBE" to the NTPC OFS, considering that the company operates on assured return model with complete fuel price pass-through.

Source : Equity Bulls

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