Global brokerage CLSA has reiterated a strong bullish stance on NHPC, assigning the stock a ‘High-Conviction Outperform’ rating. The optimism is driven mainly by expectations of a sharp rise in installed capacity in FY26, which could significantly improve NHPC’s earnings profile over the medium term.
🔑 Why CLSA Is Bullish on NHPC
1️⃣ Installed Capacity May Rise ~64% YoY in FY26
CLSA expects several of NHPC’s hydro and renewable power projects to be commissioned in FY26.
- This could lead to a ~64% year-on-year jump in installed capacity
- New capacity additions are likely to translate into strong revenue and EBITDA growth
2️⃣ Improved Earnings Visibility
- Once hydro projects are commissioned, operating costs are relatively low
- This results in stable, predictable cash flows
- Higher generation capacity should support earnings and EPS growth in coming years
3️⃣ ₹2,000 Crore Fund-Raising via Bonds
NHPC’s board has approved raising up to ₹2,000 crore through bonds.
- This will help fund ongoing and upcoming projects
- Importantly, it allows NHPC to support growth without significantly straining its balance sheet
📊 Other Positives for NHPC
- ✅ Strong backing as a government-owned power producer
- ✅ Long-term policy support for hydro and renewable energy
- ✅ Consistent dividend track record
- ✅ Direct beneficiary of India’s energy transition and clean power push
⚠️ Key Risks to Watch
- ⛔ Project execution delays or cost overruns
- ⛔ Dependence of hydro generation on rainfall and weather conditions
- ⛔ Regulatory or tariff-related changes
🔍 Buy or Sell: What Should Investors Do?
- Long-term investors:
Given CLSA’s high-conviction call and strong growth visibility in FY26,
👉 Buy / Accumulate on a medium-to-long-term horizon. - Short-term traders:
The stock has already seen some upside;
👉 Buying on dips may offer better risk–reward.
🧾 Conclusion
According to CLSA, FY26 could be a turning point for NHPC. With a sharp increase in installed capacity, better earnings visibility, and a solid funding plan, NHPC appears well-positioned as a strong medium- to long-term power sector play.
⚠️ Disclaimer: This is not investment advice. Please consult a financial advisor before making investment decisions.
