Power grid is trading at 20 PE for 6% revenue growth and 8% PAT growth for past 5 yrs. The15 year median PE is 15. so 12% return (EPS growth of 9% + Dividend yield of 3%) going forward is best case scenario for the next 5 yr since PE cannot expand further. On the other hand, if PE can contract to 15, returns can be as low as 8%.
PGInvit has got the issue of “No action”. In spite of this issue, the past 1yr price correction leads to high probability of getting 10% return for next 5 yrs and if rate reduces by 2% in next 2-3 yrs, then price appreciation of 20% is possible which means a return of 14% in best case.
(I dont consider asset addition since it looks like a jackpot right now.)
So my opinion is that at this point in time, it appears PGInvit may be better than Power grid for next 5 yr.
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