LIC-Backed Power Generation Company Has Signed A Joint Venture Agreement With Andhra Pradesh Power Generation Corporation Limited
The stock is up by 98 per cent from its 52-week low of Rs 48.48 per share.
On Friday, one power stock was trading in the green, up 2 per cent to Rs 96 per share from its previous closing of Rs 93.40. The stock’s 52-week high is Rs 118.45 and its 52-week low is Rs 48.48.
The stock name is National Hydroelectric Power Corporation Limited (NHPC Ltd).
NHPC Limited and Andhra Pradesh Power Generation Corporation Limited (APGENCO) have formed a Joint Venture Company to implement Pumped Storage Hydro Power Projects and Renewable Energy Projects in Andhra Pradesh. The agreement was signed on September 27, 2024, following a Memorandum of Understanding signed on August 23, 2023. The Joint Venture Company will initially focus on the Yaganti PSP and Rajupalem PSP projects, with a combined installed capacity of 1800 MW. Other projects may be considered in the future. The Company will be incorporated with an initial paid-up capital of Rs 1 Crore, subscribed equally by NHPC and APGENCO. The Company will have an initial Authorized Share Capital of Rs 1 crore, divided into 10 lakh equity shares of Rs 10 each. Both NHPC and APGENCO will have the right to nominate directors and the Chairman of the Board, while the MD and CFO will be nominated alternately by the parties.
Additionally, NHPC Limited has renewed its Memorandum of Understanding with the Department of Water Resources, Maharashtra, to establish Pumped Storage Projects (PSPs) totalling 7,350 MW capacity in the state. This follows a policy revision by the Maharashtra government for PSP development. The company has also been granted Navratna status by the Indian government, recognizing its significant contribution to the energy sector.
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About the Company
NHPC, India's leading hydropower company, generates and sells bulk power. It also manages construction projects, offers consultancy services, and trades power. With a current capacity of 7,097 MW, primarily from hydro sources, NHPC actively develops new projects, including 15 solar and hydro initiatives totalling 10,449 MW. It plans to add 800 MW in FY25 and 2,000 MW in FY26 while venturing into solar with a recently commissioned 380 MW project and plans for an additional 2,000 MW. Aiming to diversify, NHPC has signed MoUs with several states for pumped storage and renewable energy projects and is exploring asset monetization options.
According to the financials, NHPC Ltd has a market cap of over Rs 95,000 crore with a 3-year stock price CAGR of 56 per cent. The company has been maintaining a healthy dividend payout of 50.7 per cent. The stock has a PE of 28x, an ROE of 10 per cent and an ROCE of 8 per cent. As of June 2024, LIC owns a 3.84 per cent stake in the company. The stock is up by 98 per cent from its 52-week low of Rs 48.48 per share.
Disclaimer: The article is for informational purposes only and not investment advice.