NHPC shares rally 10% in 2 days after CLSA upgrades to ‘high conviction outperform’
state-owned mini ratna NHPC Ltd have rallied 10% in 2 days to hit a high of Rs 82.13 on the BSE after the global brokerage firm CLSA upgraded the stock to ‘High Conviction Outperform’ from an earlier ‘Outperform’.
However, the stock’s target price was slightly reduced to Rs 117, from Rs 120 previously.
CLSA's bullish outlook stems from several factors. The firm believes NHPC's stock could potentially double in the next four years. They see the recent 25% stock correction over the past six months as an attractive entry point for investors.
The global brokerage firm highlighted the start of the Parbati 2 hydro project, which has boosted NHPC's regulated equity by 27% in the first quarter of fiscal year 2025. Additionally, CLSA noted NHPC's entry into shorter-duration regulated pump storage as a positive development.
Looking ahead, CLSA also anticipates a doubling of regulated equity over fiscal years 2024-2028 as large projects come to fruition. This is expected to drive strong earnings per share (EPS) growth for the company.
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