NHPC shares open 5% lower as government plans 3.5% stake sale at Rs 66 per share

NHPC shares experienced a 5 percent dip at the opening bell on January 18 as the government disclosed its intention to sell up to a 3.5 percent stake in the PSU through an Offer for Sale (OFS) at a floor price of Rs 66 per share. This floor price represents a discount of over 9 percent compared to the closing price on the previous day. The state-run hydropower producer’s stock, which concluded at Rs 73.25 after a 1.2 percent gain on the preceding day, was trading at Rs 69.70 at 9:20 am.

As per the OFS details released in a regulatory filing on January 17, the offering will commence on January 18 for non-retail investors, while retail investors will be eligible to bid on Friday. The government plans to sell over 25 crore equity shares in NHPC, with an additional green shoe option to sell 10 crore more shares, aiming for a floor price of Rs 66 per share. Analysts estimate that the OFS could generate around Rs 2,300 crore for the exchequer.

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In Q2FY24, NHPC reported a consolidated profit of Rs 1,546 crore for the quarter ending September 2023, reflecting a 0.7 percent YoY increase over the corresponding period in the previous fiscal year. The revenue from operations also witnessed an 11.6 percent YoY growth, reaching Rs 2,931.3 crore during the reported quarter. The company is yet to announce its Q3 earnings.