Check Before You Invest : NHPC Ltd

Snapshot

Q.1 Which industry/sub-sector does NHPC Ltd belong to?

NHPC Ltd belongs to the Power sector, operating specifically within the Power Generation/Distribution segment.

Q.2 Is NHPC Ltd a good quality company?

NHPC Ltd is a average quality company, based on a somewhat consistent 10-year financial track record.

Q.3 Is NHPC Ltd undervalued or overvalued?

NHPC Ltd appears Somewhat overvalued, as its key valuation ratios are above with their past averages.

Q.4 Is NHPC Ltd a good buy now?

NHPC Ltd is a good buy now, based on strong price trend analysis suggesting prices may rise. However, you need to check its quality and valuation before making a decision

Performance Analysis

Q.1 Revenue growth of NHPC Ltd?

NHPC Ltd revenue growth is 7.8% for FY-2025, which is above its 5-year CAGR of 0.73%, indicating faster growth.

Q.2 Return on capital employed (ROCE) of NHPC Ltd?

NHPC Ltd Return on capital employed is 7.93% for FY-2025, which is below its 5-year historical median of 8.37%. The current ROCE is below its estimated weighted average cost of capital (WACC) of 11.25%, indicating value preservation.

Q.3 Return on Asset of NHPC Ltd?

NHPC Ltd Return on Asset is 3.4%, which is below its 5-year historical median of 4.75%, indicating deteriorated asset utilization efficiency.

Q.4 Return on Equity (ROE) of NHPC Ltd?

NHPC Ltd Return on equity is 8.71% for FY-2025, which is below its 5-year historical median of 11.11%, indicating the business is making worse use of its shareholders capital.

Q.5 Cash conversion cycle of NHPC Ltd?

NHPC Ltd Cash conversion cycle is 148 days, below its 5-year historical median of 181 days, indicating improved working capital management. However, you need to compare this with its peers in the industry.

	Current Level	5-year Historic Median
Asset Turnover	0.1	0.12
ROE	8.71	11.11
ROCE	7.93	8.37
Cash Conversion Cycle	148 days	181 days

Q.6 Gross Profit margin of NHPC Ltd?

NHPC Ltd Gross profit margin which is the profit after deduction of direct costs, is 54.7% for FY-2025, which is below its 5-year median of 60.8%, indicating decreasing margins.

Q.7 Operating Profit Margin of NHPC Ltd?

NHPC Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 51.5% for FY-2025, which is in line with its 5-year median of 52.86% indicating stable margins.

Q.8 Net Profit Margin of NHPC Ltd?

NHPC Ltd Net Profit Margin is 32.87% for FY-2025, is below with its 5-year median of 40.17%, indicating decreasing margins.

	Current Level	5-year Historic Median
Gross Profit Margin	54.7	60.8
Operating Profit Margin	51.5	52.86
Net Profit Margin	32.87	40.17

Q.9 Debt to Equity ratio of NHPC Ltd?

NHPC Ltd Debt-to-Equity ratio is 0.99, which is above with the industry average of 0.78, indicating higher debt levels in the industry.

Q.10 Debt to cash flow from operations of NHPC Ltd?

NHPC Ltd Debt to cash flow from operations is 7.85, which is at a unhealthy level.

Ownership & governance

Q.1 Promoter shareholding and pledge status of NHPC Ltd?

Promoters hold 67.40% of the NHPC Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

Q.1 Revenue growth of NHPC Ltd vs industry peers?

NHPC Ltd revenue CAGR is 0.73%, compared to the industry median CAGR of 6.32%, indicating stable growth and maintaining its market share.

Profit Metrics

	Current Level	5-year Industry Median
Revenue Growth	7.8	6.3
Gross Profit Growth	-2.1	4.6
Operating Profit Growth	7.9	2.1
Net Profit Growth	-14.7	9.5

Operating Efficiency

	Current Level	5-year Industry Median
Asset Turnover	0.1	0.26
ROE	8.71	10.18
ROCE	7.93	10.95
Cash Conversion Cycle (days)	148.37	69

Valuation & price assessment

Q.1 Stock return of NHPC Ltd over the last decade?

Over the last 9 year(s), the stock has delivered a CAGR of 14.8% based on the current price.

Q.2 What return has the stock given over the last decade?

	9Y	5Y	3Y	1Y
Share Price CAGR	14.8%	27.6%	21.9%	-2.5%

Q.3 Valuation ratios of NHPC Ltd vs historical?

The current P/E is higher that its historical median.

Q.4 How do the current valuation ratios compare with 5-year historical median and industry numbers?

Valuation Ratios	Current	5-year Historic Median	5-year Industry Median
Price to Earnings	26.48	13.27	27.19
Price to Book	2.07	1.91	1.80
Price to Sales	7.5	7.06	6.78
EV to EBITDA	20.16	17.17	13.53

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