NHPC share price falls nearly 3% ahead of dividend record date. Buy or wait?

Falling for the third consecutive session, NHPC share price declined nearly 3 per cent in intraday trade on Monday, February 10, reacting to the PSU company’s December quarter (Q3FY25) earnings and dividend announcement. NHPC share price opened at ₹76.11 against its previous close of ₹77.43 and dropped 2.7 per cent to the level of ₹75.33. Around 12:55 PM, the PSU stock traded 2.53 per cent down at ₹75.47.

NHPC dividend record date

NHPC’s board has approved payment of interim dividend at the rate of 14 per cent — ₹1.40 per equity share — on the face value of paid-up equity shares of ₹10 each for 2024-25.

NHPC’s board has fixed Thursday, February 13, 2025, as the record date for ascertaining shareholders’ eligibility for payment of the said interim dividend.

NHPC Q3 result

After market hours on Friday, February 7, NHPC reported a steep decline of 52.5 per cent in net profit to ₹231 crore primarily due to higher expenses, compared to ₹486.7 crore in the corresponding period last year.

The company’s revenue from operations rose 11.3 per cent to ₹2,286.8 crore, compared to ₹2,055.5 crore in the year-ago period. The PSU’s total expenses rose to ₹2,217.51 crore during the quarter from ₹1,733.01 crore a year ago.

NHPC share price trend

The PSU stock has been under pressure over the last year, falling almost 25 per cent. It hit a 52-week high of ₹118.45 on July 15 last year and a 52-week low of ₹72.19 on January 13 this year.

On a monthly scale, NHPC stock has been down since August last year.

What should investors do?

Most brokerage firms retained their views on NHPC stock after the Q3 result. However, some of them have trimmed their estimates and target prices.

JM Financial maintained a buy call on the stock but cut the target price to ₹100 from ₹108 earlier.

“We estimate revenue, EBITDA, PAT CAGR of 22 per cent, 31 per cent and 21 per cent, respectively, over FY24-27E,” said JM Financial.

“Given a dividend yield of 2 per cent and the nation’s commitment to advancing hydropower capacity due to its load-following capability and the implementation of pumped hydro storage, we reaffirm our buy rating on the sole large utility that boasts a 100 per cent green energy portfolio, with a SOTP-based target price of ₹100,” JM Financial said.

On the other hand, Antique Stock Broking maintained a ‘hold’ recommendation on the stock but cut the target price to ₹85 from ₹92 earlier.

Antique believes NHPC’s growth may remain muted in the near term until the company commissions additional capacity.

NHPC plans to add capacity at Parbatti-2 in FY25E, but earnings are expected to be realized only in FY26E as commissioning is likely to happen in Q4FY25. We have modelled the commissioning of Lower Subansiri over FY26- 27E. We expect capacity to increase at 21 per cent CAGR over FY24-27E, but a large part of it is only expected in FY27E,” said Antique.

“Post the result, we have marginally tweaked our EPS (earnings per share) estimate on account of a quarter delay in addition and thus EPS is revised lower by 7 per cent, 10 per cent and 2 per cent for FY25E, FY26E and FY27E, respectively. We have modelled in FY26E and FY27E to see an EPS increase of 16 per cent YoY and 34 per cent year-on-year, respectively,” Antique said.

Technical experts also suggest holding the stock at this juncture.

Sumeet Bagadia, Executive Director at Choice Broking, pointed out that NHPC’s share price has strong support placed at ₹70, whereas it is facing a hurdle at ₹84 apiece.

“The PSU stock may see a bounce back due to value buying, as the stock has been falling for the last three straight sessions. So, NHPC shareholders are advised to hold the scrip, maintaining stop loss at ₹70 per share mark,” said Bagadia.

“Fresh investors can also buy NHPC shares below ₹75 for the short-term target of ₹84. However, one must maintain strict stop loss at ₹70 levels while taking any fresh position in the scrip,” Bagadia said.

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Disclaimer: The views and recommendations above are those of individual analysts, experts, and brokerage firms, not Mint. We advise investors to consult certified experts before making any investment decisions.