PowerGrid shares dip 5% on weak Q4 earnings

Shares of Power Grid Corporation Ltd declined as much as 5.1% to hit an intraday low of ₹308.95 apiece on the BSE, after the state-run power company reported a 3.6% decline in its consolidated net profit to ₹4,166.33 crore in the March quarter of FY24, as against ₹4,322.08 crore reported in the corresponding period of the previous year.

The share opened lower at ₹319.45, down 1.9%, as against the previous closing price of ₹308.45. At 1:17 pm, the share price of Power Grid was trading 2.66% lower at ₹317.15. This was in contrast with the broader BSE Sensex, which was trading 765.55 points or 0.97% higher at 74,897.80. The company’s market capitalisation stood at ₹2,94,410.61 crore with more than 11.37 lakh shares exchanging hands on the BSE, as against the two-week average of 4.45 lakh shares. The company scrip hit a 52-week high of ₹328.35 on May 22 this year, and a 52-week low of ₹172.54 on May 31 last year.

In the past one month, three months and one year, the counter has surged 10.72%, 11.82% and 79.76%, respectively. In the year-to-date period, the counter has surged 32.72%.

In the January to March quarter of FY24, Power Grid's revenue from operations stood at ₹11,978.11 crore, down 2.5%, as against ₹12,285.55 crore in the March quarter of FY23. The company’s total income stood at ₹12,305.39 crore during the quarter under review, dipping marginally by 2%, as against ₹12,557.44 crore in the March quarter of FY23.

For FY24, the state-run power company’s consolidated net profit stood at ₹15,573.16 crore as against ₹15,419.74 crore in FY23. The company’s revenue from operations in FY24 stood at ₹45,843.10 crore, as against ₹45,603.11 crore in FY23.

The company has recommended a final dividend of ₹2.75/ share (i.e. @ 27.5% on the paid-up equity share capital) for the Financial Year 2023-24 subject to the shareholders' approval. The final dividend would be paid within 30 days from the date of its declaration at the AGM.

“This final dividend is in addition to the 1st Interim Dividend of ₹4.00/- per share i.e. @ 40% on the paid-up equity share capital paid on December 6, 2023 and 2nd Interim Dividend of ₹4.50/- per share (i.e. @ 45% on the paid-up equity share capital) paid on  March 5, 2024, for the Financial Year 2023-24,” says the power major.

The state-run power company also plans to raise ₹5,000 crore through a consortium of banks.

Notably, brokerage firm Morgan Stanley has maintained an ‘Overweight’ rating with a target price of ₹296 per share.