NHPC shares tumble 4.6% as govt launches OFS to sell up to 6% stake; retail investors can bid on this date

The government on Monday said it would sell up to 6% stake in NHPC at a floor price of ₹71 per share through an offer for sale (OFS) beginning on Tuesday.

"Government of India announces OFS in NHPC Ltd with a base offer of 3% of its equity and an additional 3% Green Shoe Option in case of oversubscription. Floor price fixed at ₹71 per share," Department of Investment and Public Asset Management (DIPAM) Secretary Arunish Chawla said.

The floor price of ₹71 per share is at an 8% discount over Monday's closing price of the scrip at ₹77.19 on the BSE. Shares of NHPC closed down 2.07% over the previous close.

On the NSE, the NHPC stock ended at ₹77.05, down 2.31%.

NHPC OFS: Key details

The OFS opens for non-retail investors on June 2, and for retail investors on June 3.

Sale of over 60.27 crore shares representing a 6% stake at a floor price of ₹71 a share would fetch about ₹4,200 crore to the exchequer.

This will be the third OFS of a public sector company in the current fiscal year. Last week, the government sold a 2% stake in Coal India via OFS to mop up ₹5,542 crore. In May, it sold 8.08% in the Central Bank of India to raise ₹2,266 crore. Together, the disinvestment proceeds so far in FY27 stand at ₹7,808 crore.

The FY27 Budget has estimated a mop-up of ₹80,000 crore through disinvestment and asset monetisation, more than double the ₹33,837 crore given in the Revised Estimates for FY26.

OFS FAQs answered

• The government usually launches an offer for sale (OFS) to reduce its stake in a public sector company, meet disinvestment targets, raise funds, and improve public shareholding.

• The floor price is generally set at a discount to the last traded market price to attract strong investor demand and ensure the issue is fully subscribed.

• Stocks often decline when an OFS is announced because the discounted floor price acts as a near-term benchmark, prompting traders to adjust their positions.

In simple terms, if the government is offering shares at, say, ₹95 while the stock is trading at ₹100, investors may expect the market price to move closer to ₹95. As a result, some traders sell the stock before the OFS, putting downward pressure on the share price.

• Additionally, the prospect of a large supply of shares entering the market can create temporary selling pressure and weigh on sentiment.

About NHPC

NHPC Limited (formerly National Hydroelectric Power Corporation) is a Navratna public sector undertaking (PSU) under the Government of India's Ministry of Power.

Incorporated in 1975, it is India’s largest hydropower development company with an authorised capital of ₹1.5 lakh crore.

NHPC was upgraded to Navratna status by the Government of India in August 2024. Prior to this, the company held Miniratna Category-I status since 2008.

NHPC Q4 FY26 earnings

State-owned NHPC posted over 68% jump in consolidated net profit at ₹1,549.42 crore for the March quarter 2025-26, supported by higher revenues.

It had logged a profit of ₹919.63 crore in the year-ago period, the company said in an exchange filing on Friday.

Total income during the period increased to ₹3,120.52 crore from ₹2,557.71 crore in the fourth quarter of 2024-25.

Annual net profit was at ₹4,220.46 crore as against ₹3,411.73 crore. Total income was ₹12,686.09 crore, up from ₹11,614.61 crore earlier.

Other details

The company's board also approved a final dividend of 21 paise per equity share for FY26.

In a separate statement, NHPC said during FY 2025-26, it added capacity of 1850 MW by commissioning 3 projects, namely Subansiri Lower Project (750 MW out of 2000), Parbati-II Project (800 MW), and Karnisar Solar Project (300 MW). This is the highest capacity addition during any fiscal year in its history.

Further, the company's power stations generated 23307 Million Units (MUs) in FY 2025-26, with an installed capacity of 7401 MW from 25 power stations on a standalone basis.

NHPC, along with its subsidiaries and joint ventures, presently has an installed capacity of 9333 MW from 31 power stations and is engaged in the construction of 17 projects aggregating to a total installed capacity of 9204 MW.

It also has nine projects with an aggregate capacity of 10263 MW under the clearance stage and 9 projects with an aggregate capacity of 9830 MW in the survey and investigation stage.