Deutsche Bank upgrades Indian utilities sector to "neutral" from "underweight" based on strong end-user demand and policy initiatives. Top picks: Powergrid and Jaiprakash Power Venture.
"The new directive shows that government has become more sensitive in tackling issues at both ends power or coal and advising solutions that appear closer to the ground reality," Deutsche Bank says in a note.
Imports and coal pooling to result in higher utilisation levels for independent power producers, the note adds.
JSW Energy to benefit from lower international prices, with benefits accruing in the short term, earnings upside potential higher than Tata/Adani Power.
Comparing earnings vs. bond yield - NHPC with 9% earnings (+4% div) yield is attractive.
Says NTPC also has a stable cash flow outlook in the long term, which can serve both debt and equity holders.