Saturday, January 16, 2010

WHY VALUATION OF NHPC LOW.


1.An analysts on TV say about NHPC that “this is a share of 300 rupees valuation, and also say “share market is funny that it give NTPC a valuation of 215 and NHPC only 30 I hear this advice many time by this analysts so I give you the reason of NHPC low valuation
2.NHPC total number of share is 12,300,742,773.
3.NTPC total number of shares is 8,245,464,400.
4.so NHPC have 4055278373 more share then NTPC .
5.when total number of share is high then it diluted the EPS of share this is the reason of NHPC low EPS only 0.98 per share in half year and in same period EPS of NTPC is 6.79 rupees per share so EPS of NTPC is 7 time higher than NHPC so price of NTPC is also 7 time higher than NHPC.
6.so remember this concept that “ market is always right no analysts is greater then market (included me).” And try to understand the reason of pricing of a share.

Key words:- buy hold nhpc ntpc advice sell

1 comment:

  1. My knowledge only:

    EPS is total earngs by company in an yr divided by total no of shares.

    Based on nhpc annual profit and no of shares eps value derived. if share price is low, EPS is low. EPS has link to annual share price.

    Not because EPS is less share price is less; it is reverse true. Please see warren buffet analysis link on google search; He explains EPS PE values very beautiful;

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