NTPC, India’s largest energy conglomerate, has recently grabbed investor attention due to significant developments in its operations. The company’s board has approved a substantial ₹20,832 crore investment for two major thermal power projects, sparking increased interest in the stock market.
As a result, NTPC’s shares have climbed, reaffirming its position as a key player for those looking to invest in stocks tied to India's energy sector.
Approval of two thermal power projects
At the heart of this stock surge is NTPC's board meeting, held on September 19, which sanctioned two significant investments. The first approval was for the Sipat Super Thermal Power Project, Stage-III, with a capacity of 1x800 MW, costing ₹9,790.87 crore. The second major investment, worth ₹11,130.98 crore, was allocated for the Darlipali Super Thermal Power Project, Stage-II, also with a 1x800 MW capacity.
Both projects are expected to boost NTPC’s thermal power generation and solidify its long-term growth, making it an attractive option for investors who aim to invest in stocks in the energy sector.
NTPC's green energy arm and future IPO
NTPC's stock momentum has also been fueled by developments in its green energy division. NTPC Green Energy Ltd, a subsidiary focused on renewable energy, recently filed its Draft Red Herring Prospectus (DRHP) to raise ₹10,000 crore through an initial public offering (IPO). The IPO will be a completely fresh issue with no offer-for-sale (OFS) component.
Retail investors who already hold NTPC shares stand to gain additional benefits by bidding in the shareholder category, making this an appealing time to invest in stocks associated with NTPC’s green energy initiatives.
Methanol pilot project at Kayamkulam plant
In addition to its thermal power projects, NTPC has also ventured into cleaner energy solutions. The company is set to launch a pilot project at its Kayamkulam plant, aiming to generate electricity using methanol—a cleaner, low-emission fuel.
NTPC has signed an MoU with Bharat Heavy Electricals Ltd (BHEL) to initiate methanol firing in the plant’s existing gas turbine system. If successful, this project could help reduce power generation costs and contribute to the company’s goal of cutting emissions.
These developments further strengthen NTPC’s appeal to those looking to invest in stocks in the clean energy sector.
NTPC’s stock performance in 2023
The board’s approval for these high-value investments has coincided with a remarkable year for NTPC in the stock market. NTPC shares have surged by 36% in 2023, significantly outperforming the Nifty’s 16% growth.
Over the last 12 months, the stock has rallied 75%, compared to the Nifty’s 27% gain during the same period. This strong performance highlights the potential for investors looking to invest in stocks that have a track record of delivering solid returns.
Future outlook for investors
As NTPC continues to expand its energy portfolio, both in thermal and green energy sectors, its stock remains an attractive option for long-term investors. The company’s focus on innovation, such as the methanol project, along with large-scale investments in power infrastructure, presents multiple growth opportunities.
For individuals looking to invest in stocks that are poised for future growth, NTPC offers a promising avenue, especially given its consistent stock market performance and forward-thinking approach to energy production.
NTPC’s recent developments, from massive investments to green energy initiatives, reflect a company on the rise. Investors looking to diversify their portfolio with energy stocks may find NTPC a compelling choice.
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