2025-06-10-Jefferies-印度电力月度报告-_8月起基本面有利_16页_882kb

India Utilities Equity Research: June 2025 Summary

Market Overview:
Electricity demand in India showed YoY declines in May 2025, down 4%, attributed to a high 14% growth base the year prior. Regional variations are notable, with power demand rising in the East and North-East regions but declining in West and South regions. Renewable energy capacity is projected to double by FY30E, with NTPC leading RE capacity growth at a 39% CAGR. Merchant power prices dropped 22% YoY in May 2025. Coal stock days improved to 20 days, supporting generation stability, though thermal PLF fell due to lower demand and early monsoon effects. Demand is expected to normalize over the medium term, with an overall CAGR of 6% projected for FY24-30E.

Company Recommendations:

• NTPC is retained as a "Buy," with expected strong RE capacity expansion and double-digit EPS growth.
• JSW Energy is a top pick for its balanced project portfolio and merchant capacity.
• Power Grid is recommended for higher capital expenditure driven growth potential.
  Adani Green and Adani Energy Solutions are flagged as "Buy" opportunities, while Tata Power is "Underperform."

Valuations:
NTPC trades at 9.6x FY26E EV/EBITDA and 1.7x PBV, below historical averages. Power Grid remains a "Buy" at higher EV/EBITDA valuations. Renewable-focused companies like Adani Green show premium valuations but high growth potential. Adjusted earnings and profitability metrics highlight upside despite high current PSR and PE for some names.

Risks and Opportunities:

• Positive factors include ongoing power demand recovery post base effects and strong renewable adoption.
• Risks include monsoon variations affecting agricultural demand, policy shifts like elections influencing RE auction windows, and regulatory scrutiny on merchant power prices. Rising investment in renewables and grid capacity offers growth avenues.

Key Takeaways:
The sector favors companies with renewable expansion, steady returns, grid stabilizers, and merchant capacity. Valuations offer attractive multipliers for aligned growth outlooks, but macro risks drive caution in short-term forecasts.