Power stock NSE: NHPC gains over 20% in just 1 week after higher sectoral allocation was announced in the Interim budget. In the last one and three months, NHPC overshadowed major indexes like Nifty and Sensex in terms of returns. The hydropower stock has given almost 52% in a single month.
Shares of NHPC are now trading near all time high value of ₹115. On the 5th of Feb, after making ATH, the stock saw some selloff and declined by around 12% from its high. This is not necessarily bad news as investors can consider this as a buying opportunity for short-term gains.
In 2020, NPHC was trading at a price of ₹15 per share, and now it has reached ₹115 gaining over 655%. The stock is now at a key support level of ₹103.
About NSE: NHPC
NHPC was founded in the year 1975 by the name National Hydro Electric Power Corporation. The company is under the Ministry of Power and focuses on hydropower development. While hydropower remains its core business, NHPC has also diversified into other renewable energy sources like solar, wind, and geothermal.
Headquartered in Faridabad, the company operates numerous power plants across India, boasting a total installed capacity exceeding 7000 MW.
NHPC is the largest hydropower company in India. As renewable energy sources are the prime focus, it will greatly benefit from this shifting attention towards hydro and solar energy sources.
WHY Shares of NHPC are rising?
There can be multiple reasons like getting an order worth of value 4,000 crores, Favourable Government policies towards the power sector and increased sectoral allocation behind the rise of NHPC shares.
Even when we look at NHPC’s financial statements, we see a consistent increase in its performance. Let us study some of the fundamental aspects of this company.
NHPC has outperformed its previous year’s profitability. The company is able to increase its profit almost every year. They have seen a significant increase in Return on Equity (ROE) and Return on Capital Employed (ROCE).
Such metrics highlight NHPC’s strategic efficiency in asset allocation and profit generation. These factors along with favourable market conditions combined is helping NHPC gain a significant market share which inturn is raising its share price.
Swing trading forecasts for NHPC
| Forecast | Target Price (₹) |
|---|---|
| Forecast 1 | ₹110 |
| Forecast 2 | ₹115 |
| Forecast 3 | ₹122 |
| Forecast 4 | ₹127 |
| Forecast 5 | ₹131 |
Important levels for re allocation of NHPC shares (Support/Demand zones)
| Demand Zone | Price (₹) |
|---|---|
| 1 | ₹92 |
| 2 | ₹80 |
| 3 | ₹73 |
| 4 | ₹68 |
NHPC Shareholding pattern
| Category | Percentage |
|---|---|
| Promoters | 70.95% |
| DII (Domestic Institutional Investors) | 14.94% |
| FII (Foreign Institutional Investors) | 7.38% |
| Public | 6.73% |
Cash Flow Statements of NHPC
| PARTICULARS | MAR 2023 |
|---|---|
| Profit from operations | 4,439.19 |
| Adjustment | 1,316.13 |
| Changes in Assets & Liabilities | -1,070.33 |
| Tax Paid | -791.14 |
| Operating Cash Flow | 3,893.85 |
| Investing Cash Flow | -2,929.30 |
| Financing Cash Flow | -1,519.66 |
| Net Cash Flow | -555.11 |
Conclusion
Growing need for alternate power sources like green energy such as hydro power and solar power will benefit companies like NHPC alot.
High energy demand of the rising India can only be fullfill if reneable energy sources and the infrastructure for generation, storage and transmittion of these sources are well established.
Long term investors can check forecast of NHPC upto 2030.
