NTPC stock has corrected from its May high of Rs 410 to Rs 329. The company is actively investing in new power capacity, with Rs 55,986 crore spent in FY26. While its move toward renewable and nuclear energy aims to diversify the business, investors are keeping an eye on the risks related to large-scale project execution and potential debt pressure as the firm grows.
NTPC shares have seen a significant change in price, moving from a high of Rs 410 in May to Rs 329. This movement reflects a broader shift in market sentiment for public sector energy companies. For long-term investors, the focus remains on the company's aggressive strategy to build new power capacity.
The company is currently in the middle of a massive phase of money spent on expansion. During FY26, it spent Rs 55,986 crore to build assets. With 35.7 GW of capacity currently under development, the company is aiming to secure its future growth. This is a significant scale of investment, and it highlights the company's push to maintain its status as a key power provider in India.
The strategy goes beyond traditional coal plants. The firm is now diversifying into renewable energy, nuclear power, and green hydrogen. It has set a long-term target of reaching 136 GW in renewable capacity by FY37. Through its joint venture, NPUNL, it is also entering the nuclear sector. These steps are part of a wider plan to transform into an integrated energy provider, reducing its reliance on coal.
From a valuation perspective, the stock is trading at roughly 10 times its projected FY28 earnings. A key reason for this steady earnings visibility is the company's regulated equity base, which is worth Rs 1,21,745 crore and growing at 9 percent every year. In the power sector, this regulated model provides a level of protection as tariffs are often set based on these investments.
However, investors should be aware of the risks. Large-scale expansion projects carry the risk of delays or cost increases. Additionally, the massive amount of money being spent requires constant debt management. If the power demand does not grow as expected, or if projects face long delays in getting operational, this could create pressure on the company's financial health.
Going forward, the key items for investors to track include project commissioning timelines, changes in power demand, and how efficiently the company manages its debt during this growth phase. The progress of the 12 GW capacity currently in the tendering phase will also provide a signal about future growth.