Power Grid Corporation of India Limited is an electric utility company which is primarily engaged in the transmission and distribution of electric power. It is owned by the Government of India.
The market capitalisation of Power Grid Corporation is a little over Rs.94,820 crore as of July 9, 2018.
Company’s Wealth and Recent Performance
- For the March quarter of the financial year 2017-18, the company’s total income was disclosed to be at Rs.8,099 crore. This is a 15% increase over the revenue reported in the same period last year. An increase of 16% was also seen in the company’s consolidated income for the year ended March 31, 2018, with the total figure standing at Rs.30,431 crore.
- The company’s EBITDA for the year also increased by 15%.
- Consequently, the net profit after tax for the fourth quarter of the FY 2017-18 was reported to be at Rs.2,005 crore - a five 5% increase over the PAT reported for the Q4 FY17. Similarly, the PAT for the entire fiscal also improved by 10% to stand at Rs.8,198 crore.
- The company’s gross fixed assets, consolidated, were reported to be worth Rs.1,79,890 crore at the end of the fiscal year. This translates into an increase of more than 10% in gross fixed assets over the course of the year.
- At the same time, the total debt of Power Grid Corporation has also increased to Rs.1,30,503 crore from Rs.1,17,488 crore over the course of the fiscal year. Therefore, its debt-to-equity ratio stands at 71:29, according to the recently released reports.
- The earnings per share, as of March 31, 2018, was stated to be Rs.15.67 as against Rs.14.24 in the previous fiscal year.
Power Grid Corporation of India Limited Stock Trends in 2018
- On January 2, 2018, the opening price of Power Grid stock was Rs.201.25 on the National Stock Exchange. Over the course of the month, the scrip moved on to shed points marginally to end the month at Rs.193.80. The investors made small gains during intraday sessions but over the month, their shares went down.
- The month of February was quite rocky for the investors. Owing to turbulence in the international markets, investors were quite cautious with their daily trades and as a result, the Power Grid Corp stock price was on a rather rocky path. An interim dividend of 24.5% was also announced in the second week of February. Despite uncertainties in the market, the stock managed to make small gains towards the end of the month to close at Rs.197.70 on February 28.
- For the month of March, things were fairly stable as the Power Grid shares changed hands at levels above Rs.193. In April, the scrip commenced a bull run for the first time in 2018. This surge was driven by positive developments in the company. The share price of Power Grid good gains and the closing price at the end of the month was Rs.207.85.
- The prices rose slightly in May as the investors began looking forward to the year-end annual results. It rose to cross the Rs.210 mark, although the scrip moved on to shed all its previous gains heavily in June. From being traded at levels close to Rs.205, the scrip went down to touch the Rs.190 mark. This freefall continued in the first week of July as well, with the scrip trading close to its 52-week low price of Rs.180.55.
Power Grid Corporation of India Limited Stock Trends in 2016 and 2017
- At the start of January 2016, the share price of Power Grid Corporation was varying at levels slightly above the Rs.140 mark. The stocks went through their usual ups and downs but managed to hold steady at levels well above Rs.130. An interim dividend of 8% was announced in February. Things did not change a lot in the month of March either as the stocks ended the month at a closing price of Rs.139.10.
- The share price started rising in the second quarter of the year. The Power Grid shares made steady gains in April and through most of May. Towards the end of the month, the scrip managed to cross the psychological barrier of Rs.150. June was a bountiful month for the investors as the share price moved up by more than 5% to reach the Rs.160 mark.
- The first half of July was a rather stable one for the investors. The share price varied at levels varying from Rs.160 - Rs.165. The prices started to rise once again in the second half and this time, the scrip was heading close to the Rs.180 mark. The shares got the breakthrough they needed in the second half of August and they ended the month at Rs.183.70 on the NSE.
- A final dividend of 15.1% was announced in early September. This was followed by a little dip in the price but the shares managed to retain their bearings at levels above Rs.175. Things did not change a lot through the second half of September and most of October. Interestingly, it wasn’t until post-demonetisation that the prices rose again. In fact, Power Grid Corporation of India Limited was one of the few companies whose shares rose immediately post demonetisation. The scrip ended the year at Rs.180.
- The Power Grid Corporation shares started the month of January 2017 on a strong note. The shares were bullish and the price moved up by a little over 10% to cross the Rs.200 mark. Things stayed on the same wavelength through the first half of February. An interim dividend of 10% was announced in the month. The prices dipped slightly in the final week of the month to reach its previous levels above Rs.190.
- Things were fairly stagnant in the month of March. The prices started to rise once again in April and the Power Grid shares surpassed their previous gains to reach new heights at Rs.210. Apart from the marginal dips, the shares were traded at levels above Rs.200 through most of May and June.
- The stocks continued to be bullish through the month of July as well. The stock price of Power Grid Corporation rose superbly to reach its new 52-week high at Rs.226.60 in early August. However, this significant rise was followed by a bull run which continued until October. From being traded at levels above Rs.220, the share price went down gradually to descend back to its previous levels at Rs.200. A final dividend of 33.5% was announced in September.
- The price rose slightly in October but the gains here weren’t as impressive as the ones made in July. The final quarter of the year was rather bearish and the shares ended the year at Rs.200.35.
Should you invest in Power Grid Corporation of India Limited?
- Power Grid Corporation is a ‘Navratna’ company which has been assigned the task of transmitting and distributing power in India. In fact, it is responsible for transmitting more than 50% of the total power generated in the country.
- The Government of India has increased its focus on harnessing renewable energy in the country to provide cheap, sustainable power. As a result, Power Grid Corp has been entrusted by the Ministry of Power to design and develop a grid integration plan that would successfully add the power generated from renewable energy to the existing grid. This plan has been dubbed as Green Energy Corridors and a detailed report on the same can be found on the official website.
- The company’s future prospects are definitely bright, given that it has a key role to play in improving the power sector in the country. Considering its financial performance, the company, in its most recent report, disclosed its revenue and net profit after tax for the FY 2018 to be fairly better than the previous year. However, it is worth noting that the company’s debt for the year has increased by a significant margin. This is understandable, given that the company is pursuing aggressive growth in the future by issuing ‘AAA’ rated bonds in the country.
- Considering the performance of the stock itself, the scrip was highly bullish - starting from 2016. In just two years, the Power Grid shares managed to deliver returns of more than 50%, although the scrip has been quite bearish in 2018. Its price is on a downward path as of early July 2018 and for many investors, this makes it an ideal time to buy. From a dividend point of view, the company has been quite frequent with dividends, providing at least two of them in a year.
- Before investing in this scrip, it is strongly recommended that you do your own research.
Power Grid Corporation of India Limited is a state-owned company which is primarily engaged in the transmission and distribution of power in India. The company has been dubbed as a ‘Navratna’ Public Sector Enterprise and it transmits more than 50% of the total power generated in India through its transmission infrastructure. In addition to this, Power Grid Corp is also engaged in the telecom sector by allowed telecom businesses to leverage its transmission network. It also provides consultancy services pertaining to transmission and distribution of power.
History of the Company
Power Grid Corporation of India Limited was formed on October 23, 1989, under the Companies Act of 1956. Back then, the company was known as the National Power Transmission Corporation Limited and it was charged with the planning, executing, managing, and operating power transmission systems in the country at a central and regional level. The company commenced its first major operation in April 1991, when the Nuclear Power Corporation Limited transferred its transmission assets to Power Grid Corp. The company grew over the course of next decade to accomplish better grid management and operation. The company’s equity shares were listed on the stock exchanges in October 2007.
Management of the Company
Mr. I.S Jha - Chairman & Managing Director
Mr. Jha has been the Chairman and Managing Director of Power Grid Corporation of India Limited since November 2015. Prior to his appointment to this post, Mr. Jha served as the Director of Projects in the company where he oversaw important aspects of power transmission and distribution projects. He started his professional career in 1981 with NTPC - as an Executive Trainee. He has been with Power Grid right from the beginning in 1991. Over his extensive tenure, he has led several critical transmission projects. One of his most impressive achievements has been the integration of renewables with the existing national grid. Mr. Jha graduated as an Electrical Engineer from NIT, Jamshedpur.
Mr. K Sreekant - Director (Finance)
Mr. Sreekant presently serves as the Director of Finance of Power Grid Corporation of India Limited. He has been a part of the power industry for more than 30 years and has served in various positions, all related to finance and accounting. He is well-versed in all the financial aspects that go into successfully implementing a transmission project such as long-term financial planning, budget planning, investment appraisals and resource mobilisation. Prior to his appointment to Power Grid, he served as the General Manager (Finance) in NTPC.
Mr. Ravi P Singh - Director (Personnel)
Mr. Singh graduated from NIT, Allahabad as a Mechanical Engineer and followed it with a Post Graduate Diploma from AIMA, New Delhi. Prior to his appointment to the present post, Mr. Singh served as the Executive Director - Region II and the Executive Director of Human Resource Management and Corporate Communication in Power Grid Corp. He has been a part of the power industry for more than 35 years now and has held various key positions. He joined the Board of Directors in April 2012 and prior to joining the company, he worked with NTPC for 10 years.
Power Grid Corporation of India Limited Listings in NSE, BSE, and Indices
The Power Grid Corporation shares are publicly available for trading on the country’s two most prominent stock exchanges - the National Stock Exchange and the Bombay Stock Exchange. The codes for the same are as follows:
- NSE Code: POWERGRID
- BSE Code: 532898
- ISIN: INE752E01010
- Sector: Power - Generation & Distribution
Coming to the stock market indices, Power Grid Corporation of India Limited forms a part of the following:
- NIFTY 100
- NIFTY 200
- NIFTY 500
- NIFTY Energy
- S&P BSE 100
- S&P BSE 200
- S&P BSE 500
- NIFTY 50 USD
- S&P BSE Power
- S&P BSE SENSEX
- S&P BSE Utilities
B-9, Qutab Institutional Area
New Delhi - 110016
Contact number: 0124-2822000, 2823000
Plot No. 2, Sector 29,
Near IFFCO Chowk
Gurgaon, Haryana - 122001
Contact number: 0124-2571762
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