NHPC Approves ₹6,900 Crore Borrowing Plan

State-owned hydroelectric power producer NHPC Ltd announced a revised borrowing plan to raise up to ₹6,900 crore during FY2024-25. The decision was finalizsed at the company’s board meeting on December 12, 2024. This move aims to bolster its financial position and fund operational and expansion needs.

Key Components of the Borrowing Plan

1. Corporate Bonds:
   NHPC plans to raise funds through secured or unsecured, redeemable, taxable, non-cumulative, non-convertible corporate bonds. These bonds will be issued in one or more series or tranches via private placement.
2. Term Loans and ECBs:
   The plan also includes raising term loans or external commercial borrowings (ECBs) in suitable tranches, ensuring flexibility in sourcing funds.
3. AE-Series Bonds:
   As part of this strategy, NHPC’s board reviewed the General Information Document (GID) and Key Information Document (KID) for issuing AE-Series Bonds. These unsecured, redeemable, taxable, and non-convertible bonds are valued at up to ₹2,600 crore and will be issued in one or more tranches through private placement.

Financial Performance: A Mixed Bag in Q2 FY25

NHPC’s financial results for the second quarter of FY25 reflected challenges despite a slight improvement in revenue.

1.Decline in Profitability

• Net Profit: ₹909 crore, a 41.2% drop compared to ₹1,546 crore in Q2 FY24.
• Revenue Growth: Revenue increased by 4.1% to ₹3,052 crore, up from ₹2,931.3 crore in the same quarter last year.

2. Operational Metrics

• EBITDA Growth: A modest 1.7% year-on-year rise to ₹1,799 crore.
• Margin Contraction: EBITDA margins reduced to 58.9% from 60.3%, indicating slight pressure on operational efficiency.

Stock Market Update

NHPC’s share price as of December 13, 2024, the stock was trading lower by 1.32% at 11:20 am. 

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.