Stock to buy: Anand Rathi recommends NHPC as its special pick; sees 22% upside potential
Stock to buy: NHPC share price target of ₹121 apiece, implies an upside potential of nearly 22% from Friday’s closing price.
Stock to buy: Brokerage firm Anand Rathi has recommended state-owned hydroelectric generation company NHPC Ltd as its special stock pick. The brokerage firm remains bullish on NHPC shares and expects around 22% upside for the stock.
NHPC share price has jumped more than 114% in the past one year, while the stock is up more than 52% year-to-date (YTD). After a sharp rally, NHPC shares underwent a major consolidation for over three months.
“Recently we witnessed a breakout from this consolidation and the price action resembles a bullish inverse Head & Shoulder pattern. Thus, we advise traders to accumulate NHPC shares in the range of ₹99 – 95 with a stop loss of ₹85 on a closing basis for an upside target of ₹121,” Anand Rathi Research Team said in a note.
NHPC share price target of ₹121 apiece, implies an upside potential of nearly 22% from Friday’s closing price.
NHPC is a Mini Ratna category I public sector utility and its core operations revolve around the production and distribution of substantial power volumes to diverse Power Utilities. The company also engages in offering project management, construction contracts, consultancy services, and power trading activities.
“The overall financial risk profile of NHPC continued to remain comfortable despite large capex and dividend payout. The company is the largest hydropower producer with a strong financial risk profile and focused on maintaining an average return on equity of 16.5% going forward,” the brokerage firm noted.
NHPC reported a consolidated net profit of ₹628.44 crore for the third quarter ended December 2023, registering a decline of 19% from ₹775.99 crore in the year-ago period. The company’s total income declined to ₹2,549.69 crore in Q3FY24 from ₹2,691.34 crore, YoY.
In the FY2023, NHPC’s power plants collectively achieved an impressive Aggregate Plant Availability Factor (PAF) of 88.7%, an improvement from the previous year’s figure of 87.8%.
At 10:40 am, NHPC shares were trading 0.78% higher at ₹100.00 apiece on the BSE.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.