NHPC, India’s leading hydropower company, witnessed a significant surge in its stock price on February 20, 2025, following a crucial upgrade by global brokerage firm CLSA. With its recent correction presenting a strong buying opportunity, investors are eyeing NHPC as a high-potential stock. Let’s dive deep into the reasons behind this surge, the company’s ambitious renewable energy investments, and what the future holds for NHPC shareholders.
NHPC Stock Performance: What Triggered the Surge?
NHPC’s shares soared by 4% after CLSA upgraded its rating to “high conviction outperform.” At 10:45 AM, shares were trading at Rs 76.8, reflecting a 2.9% increase on the NSE.
Why CLSA Upgraded NHPC:
- Recent Correction: The stock had seen a 19% decline over the past year, making the current levels attractive for fresh buying.
- Long-Term Growth: CLSA projects that NHPC’s stock price could potentially double over the next four years, driven by new hydro projects and expansion in renewable energy.
- Upcoming Project Commissioning: The Parbati 2 hydro project and Subansiri hydropower project are expected to boost NHPC’s financials significantly by FY26.
Investment in Renewable Energy: NHPC’s Green Push
NHPC is making a bold move into renewable energy with a Rs 5,500 crore investment in a 1,000 MW solar power project in Bihar. This initiative aligns with India’s green energy transition and NHPC’s strategy to diversify its portfolio beyond hydropower.
Key Highlights of NHPC’s Solar Expansion:
- Renewable Energy Focus: NHPC aims to be a key player in India’s solar and wind energy market.
- Green Hydrogen Production: The company plans to produce green hydrogen using solar power, marking a significant step towards sustainable energy solutions.
- Government Backing: NHPC’s expansion aligns with India’s renewable energy goals, ensuring strong policy support.
Operational Capacity Expansion: Scaling Hydropower
NHPC currently operates with a total capacity of 7,233 MW, with 6,571 MW coming from hydropower. The company is aggressively expanding its footprint with an additional 9,314 MW of hydro projects under construction.
| Current Capacity | Under Construction | Planned Capacity |
|---|---|---|
| 7,233 MW | 9,314 MW | More in pipeline |
What This Means for Investors:
With hydro and solar projects in the pipeline, NHPC’s revenue and profitability are expected to see substantial growth, making it a strong contender in India’s energy sector.
Market Performance: NHPC vs Nifty 50
While NHPC’s shares have declined 19% in the past year, the Nifty 50 index has gained 3.1% in the same period.
Why This Matters:
- The decline presents an attractive entry point for long-term investors.
- As project revenues materialize, NHPC is likely to outperform market expectations.
- Government policies promoting renewable energy can act as a growth catalyst for NHPC.
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FAQs
1. Why did NHPC’s shares rise on February 20, 2025?
NHPC shares rose by 4% after CLSA upgraded the stock to a “high conviction outperform” rating, citing strong growth potential due to upcoming projects.
2. What are NHPC’s major upcoming projects?
NHPC is set to commission the Parbati 2 and Subansiri hydropower projects by FY26, expected to significantly boost revenues.
3. Is NHPC a good investment?
Given its strong fundamentals, aggressive expansion in renewable energy, and CLSA’s projection of the stock doubling in four years, NHPC is considered a promising long-term investment.
4. How can I invest in NHPC?
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