Any current/future new fundraising through debt or equity?

NHPC has sufficient equity available, ranging between Rs. 2,500 to Rs. 3,000 Crore, even after loan repayments and dividend distributions, so is comfortable with equity contribution for upcoming projects. Funding pattern for projects follows 70% debt and 30% internal accruals (equity). Loans are being raised at competitive rates, e.g., Rs. 2,000 Crore at 7.54% interest with flexibility for prepayment without charges. NHPC has no issues with financing; complete loan tie-ups are in place. Equity contribution for subsidiary projects is largely complete (e.g., 100% equity in Teesta-VI, Rangit-IV,

Any current/future capex/capital investment/strategic investment?

Current average capex is in the range of Rs. 8,000 to Rs. 10,000 Crore on a consolidated basis. NHPC has fully contributed equity in subsidiaries like Teesta-VI, Rangit-IV, Pakal Dul, and Kiru; minimal further equity needed in these. No significant equity dilution expected; NHPC is comfortable funding equity from internal accruals. Several pump hydro storage (PHS) projects are planned through MoUs with states: - Maharashtra: 4 PHS projects totaling 7,350 MW under development. - Odisha: At least 2,000 MW PHS and 1,000+ MW renewable projects planned. - Andhra Pradesh: 2,000 MW PHS projects

Future growth expectations in sales/revenue/volumes?

NHPC plans commissioning of significant hydro capacity in coming years: - 500 MW (Subansiri Lower Project) by March 2024 (revenue recognition from next year). - Around 2,500 MW expected by March 2025, including Parbati-II (800 MW), Rangit-IV (120 MW), and multiple Subansiri units (1,500 MW). Renewable energy portfolio under construction includes 1,000 MW solar, and projects in subsidiaries totaling over 350 MW, plus a recently won 200 MW solar bid in Gujarat. NHPC maintains focus on hydro but will undertake solar/wind projects targeting a minimum 12% RoE. Generation volume for Q2

Future growth expectations in earnings/operating earnings/profits/EPS?

NHPC's future earnings growth is influenced by its substantial project pipeline, including hydro and pump hydro storage projects, with comfortable equity availability (~Rs. 2,500 to 3,000 Crore). Return on equity (ROE) for hydro projects, including the JV pump hydro storage with Andhra Pradesh, is expected at 16.5%. Generation depends on water availability; despite recent La Nina conditions reducing generation by ~8%, NHPC can claim shortfall per CERC regulations, insulating base returns around 16.5%. Incentive income recognition changes may impact reported earnings timing, with incentives lik

Current/ Expected Orderbook/ Pending Orders?

NHPC has several ongoing and planned projects, including major hydroelectric power projects like Subansiri Lower Project, Parbati-II, Rangit-IV, and Dibang Multipurpose Project. Subansiri Lower Project: Active construction; commissioning of two units expected by Q4 FY24; remaining units by May 2025. Parbati-II Project: Targeted completion by September 2024. Dibang Multipurpose Project: Several packages awarded; remaining packages to be awarded in current financial year. New MoUs signed with Odisha and Andhra Pradesh for development of pump storage projects and renewable energy, with plans for

NHPC LtdQ2 FY24Power

NHPC Ltd Q2 FY24 Earnings Call Analysis

Revenue, margin, capex, fundraise and order book outlook from management commentary.

Price: ₹73.3P/E: 20.1Market Cap: ₹76.3K CrSector: Power

Management growth scorecard

Revenue

Category 3

Margin

Category 3

Fundraise

Yes

Order

N/A

Capex

Yes

2 of 4 growth signals are positive.

Full analysis

Revenue guidance

Category 3

NHPC plans commissioning of significant hydro capacity in coming years:
- 500 MW (Subansiri Lower Project) by March 2024 (revenue recognition from next year).
- Around 2,500 MW expected by March 2025, including Parbati-II (800 MW), Rangit-IV (120 MW), and multiple Subansiri units (1,500 MW).
Renewable energy portfolio under construction includes 1,000 MW solar, and projects in subsidiaries totaling over 350 MW, plus a recently won 200 MW solar bid in Gujarat.
NHPC maintains focus on hydro but will undertake solar/wind projects targeting a minimum 12% RoE.
Generation volume for Q2 FY24 was 9,010 million units, down 11% YoY due to water availability and weather events; future volumes depend on hydrological conditions.
Incentive income recognition is deferred to second half, linked to actual plant availability factor (PAF), impacting revenue timing.
Overall, steady growth expected driven by capacity additions, subject to hydrological variability and regulatory realizations.

Margin guidance

Category 3

NHPC's future earnings growth is influenced by its substantial project pipeline, including hydro and pump hydro storage projects, with comfortable equity availability (~Rs. 2,500 to 3,000 Crore).
Return on equity (ROE) for hydro projects, including the JV pump hydro storage with Andhra Pradesh, is expected at 16.5%.
Generation depends on water availability; despite recent La Nina conditions reducing generation by ~8%, NHPC can claim shortfall per CERC regulations, insulating base returns around 16.5%.
Incentive income recognition changes may impact reported earnings timing, with incentives likely accruing in the second half of fiscal years.
Cost of equity is estimated at approximately 12%, supporting project financing without substantial equity dilution.
Insurance covers unforeseen losses (e.g., Teesta basin flood), mitigating impact on profits.
NHPC maintains low-cost funding (loans at ~7.54%) and passes through cost escalations in tariffs, supporting stable profitability.

See what NHPC Ltd management said on margin guidance — free account, 30 seconds.

Fundraise plans

Yes

NHPC has sufficient equity available, ranging between Rs. 2,500 to Rs. 3,000 Crore, even after loan repayments and dividend distributions, so is comfortable with equity contribution for upcoming projects.
Funding pattern for projects follows 70% debt and 30% internal accruals (equity).
Loans are being raised at competitive rates, e.g., Rs. 2,000 Crore at 7.54% interest with flexibility for prepayment without charges.
NHPC has no issues with financing; complete loan tie-ups are in place.
Equity contribution for subsidiary projects is largely complete (e.g., 100% equity in Teesta-VI, Rangit-IV, Pakal Dul, Kiru).
No explicit mention of planned equity dilution; management indicates comfort with internal equity for ongoing and pipeline projects.
Overall, no current plans to raise fresh equity; debt fundraising at favorable terms is ongoing to support capex.

Order book

NHPC has several ongoing and planned projects, including major hydroelectric power projects like Subansiri Lower Project, Parbati-II, Rangit-IV, and Dibang Multipurpose Project.
Subansiri Lower Project: Active construction; commissioning of two units expected by Q4 FY24; remaining units by May 2025.
Parbati-II Project: Targeted completion by September 2024.
Dibang Multipurpose Project: Several packages awarded; remaining packages to be awarded in current financial year.
New MoUs signed with Odisha and Andhra Pradesh for development of pump storage projects and renewable energy, with plans for 2,000+ MW pump storage in both states and 1,000+ MW renewable energy projects in Odisha.
NHPC’s renewable portfolio includes under-construction projects: 1,000 MW solar at NHPC, 65 MW at Bundelkhand Saur Urja Ltd, 88 MW at NHDC, and recently won 200 MW solar project in Gujarat.
Overall, NHPC’s orderbook involves multi-gigawatt hydro projects under various stages of execution and planning.

See what NHPC Ltd management said on order book — free account, 30 seconds.

Capex plans

Yes

Current average capex is in the range of Rs. 8,000 to Rs. 10,000 Crore on a consolidated basis.
NHPC has fully contributed equity in subsidiaries like Teesta-VI, Rangit-IV, Pakal Dul, and Kiru; minimal further equity needed in these.
No significant equity dilution expected; NHPC is comfortable funding equity from internal accruals.
Several pump hydro storage (PHS) projects are planned through MoUs with states:
- Maharashtra: 4 PHS projects totaling 7,350 MW under development.
- Odisha: At least 2,000 MW PHS and 1,000+ MW renewable projects planned.
- Andhra Pradesh: 2,000 MW PHS projects in joint venture mode; 950 MW Kamlapadu and 1,000 MW Yaganti in phase one.
NHPC continues selective renewable energy projects (solar, wind) maintaining a minimum 12% ROE threshold.

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NHPC Ltd Q2 FY24 Earnings Call Analysis

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