NHPC Share Price Surges 5% as Open-Ended Offer for Sale Opens to Retail Investors: Should Investors Consider Participation?

NHPC Share Price Surges 5.08% Amid Government's Offer-for-Sale

In a surprise move, the share price of NHPC (National Hydroelectric Power Corporation) surged 5.08% during Wednesday's trading session, defying the stock market crash. This uptick comes as the Indian government's offer-for-sale (OFS) opened for retail investors today.

The stock began the day at ₹75.56 per share, up from its previous close of ₹72.29 on Tuesday. This marks a significant rebound from a day earlier, when NHPC shares had declined more than 4% after the OFS opened for non-retail investors.

OFS Details

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The central government, on June 1, announced the launch of the NHPC OFS, comprising a base issue of 3% of equity, with a 3% green shoe option to be exercised in the event of strong investor demand. As per stock exchange data, the Central government held a 67.4% stake in NHPC at the end of the March quarter.

The floor price for the NHPC OFS has been set at ₹71 per share, representing a discount of about ₹4 per share to Monday's close of ₹75 per share. The OFS opened for non-retail investors on Tuesday, June 2, and witnessed robust demand, with the issue being subscribed 3.47 times the shares on offer by the close of bidding.

According to DIPAM Secretary Arunish Chawla, the OFS witnessed strong investor interest, with subscriptions reaching 3.47 times the shares on offer on the first day. He noted that share allotment would be carried out based on price priority and confirmed that the government would also offload additional shares through the green shoe option.

Expected Proceeds and Analyst Views

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The issue is expected to generate approximately ₹4,200 crore for the government. Several analysts have weighed in on the decision for retail investors to participate in the OFS.

Seema Srivastava, Senior Research Analyst at SMC Global Securities, believes that retail investors should consider participating if they are long-term, dividend-focused investors. She notes that the 6% stake sale improves liquidity without hurting promoter control.

Mahesh M Ojha, VP Research & Business Development at Kantilal Chhaganlal Securities, recommends that retail investors consider participating if the stock approaches the ₹72–73 range, as this level appears to offer a more favourable risk-reward opportunity.

Technical Analysis

Virat Jagad, Sr. Technical Research Analyst at Bonanza, notes that NHPC remains in a weak-to-neutral technical structure as the stock continues to trade below a long-term descending trendline. He finds immediate support near ₹72–73, while resistance is seen around ₹78–80. A sustained move above ₹80 would be required to improve the technical outlook and open the possibility of a recovery towards ₹84–86.