NHPC shares up 161% from 52-week low: Price targets, technicals, valuation and more

Shares of hydropower producer NHPC Ltd have surged 161% from their 52-week low in nearly a year. The multibagger stock, which fell to a 52-week low of Rs 37.80 on February 27, 2023, rose to a high of Rs 98.90 in the current session. In comparison, the BSE power index gained 95% during the period. NHPC shares are on a bull run in the short term too climbing 82% in the last three months.

Stock Movement Today

NHPC stock surged to high of Rs 98.90 in the current session, rising 6.40% against the previous close of Rs 92.95 on BSE. The rally in the stock came after Prime Minister Narendra Modi laid the foundation stone for a 300 MW solar power plant in Bikaner, Rajasthan on February 16. NHPC will set up the project under the government's CPSU Scheme, Phase-II, Tranche-III, with a total investment of over Rs 1,732 crore. The project is scheduled to be commissioned by September 2024.

NHPC stock also logged a high turnover of Rs 219.10 crore on Monday with 226.42 lakh shares changing hands on BSE. Market cap of the firm climbed to Rs 96,783 crore. The stock touched its record high of Rs 115.85 on February 5 this year.

Analysts' Take

Analysts say of late, the stock is in a bull run and expect it to rise up to Rs 135 in the short term.

Shiju Koothupalakkal, Technical Research Analyst, Prabhudas Lilladher said, "The stock after the decent run up has witnessed a minor correction to take support near the significant 50EMA level of Rs 77.50 and indicated a pullback to improve the bias. Currently with near-term support at Rs 88 zone, the pullback can further strengthen, if a decisive breach above Rs 97 levels is confirmed where it has found some resistance and can expect for further targets of Rs 105 and Rs 114 levels, respectively. The major support would be maintained near the significant 50EMA level of Rs 78 zone below which the bias can turn little bit weak."

KKunal V Parar, VP of Technical Research and Algo, Choice Broking said, "The stock has recently found support at its 200 Hourly Moving Average, indicating a strong bounce-back in its price movement. Additionally, it has consistently traded above all its long-term moving averages, indicating a positive trend in the stock. Furthermore, a Bullish Harami Candlestick pattern has formed on the daily chart, signaling a bullish reversal and suggesting potential upward momentum in the stock. The daily momentum indicator, Relative Strength Index (RSI), is reading above 50, indicating positive momentum and market sentiment in the stock. Considering the technical structure outlined above, we anticipate significant upside potential in the stock, with a projected target range of Rs 115-135. The downside is supported at Rs 80, providing a solid level of support for the stock's price movement."

Ruchit Jain, Lead Research, 5paisa.com said, "Post a sharp rally, the stock formed a high around Rs. 115 at the start of February, but then witnessed profit booking in last couple of weeks. The momentum readings which were in the overbought zone, have started cooling-off which hints at probability of a time-wise corrective phase in the short term. The immediate support for the stock is placed around the 40-DEMA at Rs.82 while resistance is seen in the range of Rs 105-110. Although the longer trend rend remains positive, we expect the stock to consolidate in this broad range in the short term."

Abhijeet from Tips2trades said, "NHPC is bullish on the daily charts with a strong resistance at Rs 96.25. A daily close above this resistance could lead to target of Rs 109 in the near term. Support will be at Rs 88.55."

Stock Technicals

In terms of technicals, the relative strength index (RSI) of the stock stands at 58, signaling it's trading neither in the overbought nor in the oversold zone. NHPC shares are trading higher than the 5 day, 10 day, 20 day, 30 day, 50 day, 100 day, 150 day and 200 day moving averages.

Valuation

The green energy stock has a PE ratio of 26.03 against an industry PE of 24.89. The price to book ratio of NHPC is 2.63.

Q3 Earnings

The state-owned power producer reported a 26.77 per cent decline in its consolidated net profit to Rs 491.90 crore as against Rs 671.67 crore in the corresponding period last fiscal. Revenue from operations fell 20.42 per cent in the December 2023 quarter compared to Rs 2,055.50 crore in the year-ago period. NHPC also announced an interim dividend of Rs 1.4 a share for the financial year 2023-24.

About the Company

NHPC Limited is engaged in the generation and sale of bulk power to various power utilities. The company’s other business activities include project management / construction contracts/ consultancy assignment services and trading of power. The company’s power stations include Salal, Dulhasti, Kishanganga, Nimoo Bazgo, Chutak, Baira Siul, Tanakpur, Dhauliganga, Rangit, Loktak, Indira Saga, Chamera - I, Uri - I, Chamera - II and Omkareshwa.

Disclaimer: Business Today provides stock market news for informational purposes only and should not be construed as investment advice. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.

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