Power Sector : Opportunities in threats

           

Large Investments of  over $ 600 billion is projected in this sector and this sector is hence supposed to grow at frantic pace . Interesting the industry structure is also supposed to change with large number of  players in fray . SO it is right time to enter

Also Power companies whether they are in generation , transmission or distribution have stretched balance sheet .So where is the opportunity ??

These threats of bankruptcy indicates opportunities of different kind

1) Fixed income  options of relatively stronger companies in current context like Tata power , NTPC and NHPC , Power Grid can be good to collection if the credit rating of sector collapses and these are avialable at significantly below par

2) Stocks when prices are  at 5 years lows : Most of the these stocks are at or near 5 year low prices inspite of increase in turnover and EBITA . At these gloomy levels and banks getting strict on NPAs , I am sure we will see lot of consolidation and realignment . I still feel these are interesting entry points .