LIC-Backed Power Generation Company Signs a 7,350-MW Energy Storage Systems MoU with Government of Maharashtra
The stock gave multibagger returns of 100 per cent in just 1 year whereas BSE Sensex Index was up by 25 per cent in the same period.
On Wednesday, one multibagger power stock was trading in the green, up 0.25 per cent to Rs 99.28 per share from its previous closing of Rs 99.04. 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, previously entered into a Memorandum of Understanding (MoU) with the Department of Energy, Government of Maharashtra, for establishing Energy Storage Systems (Pumped Storage Systems) along with other Renewable Energy Sources (Solar, Wind, Hybrid). This MoU aimed to create a total capacity of 7,350 MW. Following the issuance of a corrigendum on July 31, 2024, regarding the Policy for the development of Pumped Storage Projects (PSPs), PSPs cum LIS, and co-located PSP-Solar/Other Renewable Energy Hybrid Projects through Public Private Partnership by the Department of Water Resources (WRD), Government of Maharashtra, the MoU has been signed again with WRD on September 3, 2024. This renewed MoU paves the way for establishing Pumped Storage Projects viz. Kengadi (1,550 MW), Savitri (2,250 MW), Kalu (1,150 MW), and Jalond (2,400 MW) in Maharashtra, with a total capacity of 7,350 MW.
Additionally, the company informed that the Department of Public Enterprises (DPE), Ministry of Finance, Govt. of India vide O.M. dated August 30, 2024, has conveyed that the Competenet Authority has approved the proposal for the grant of Navratna Status to NHPC Limited.
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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 99,000 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 gave multibagger returns of 100 per cent in just 1 year whereas BSE Sensex Index was up by 25 per cent in the same period.
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