NHPC share price rises 5% as OFS opens for retail investors. Should you participate or not?

NHPC share price surged 5.08% during Wednesday’s trading session, defying the stock market crash, 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. A day earlier, NHPC shares had declined more than 4% after the OFS opened for non-retail investors.

NHPC's OFS details

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.

DIPAM Secretary Arunish Chawla stated that 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.

The issue is expected to generate approximately ₹4,200 crore for the government.

Should retail investors apply for NHPC OFS?

Seema Srivastava, Senior Research Analyst at SMC Global Securities, believes that for retail investors, the case hinges on the objective: it gives long-term, dividend-focused investors a decent entry into India’s largest hydro PSU, especially if you believe in NHPC’s renewable and project execution push, and the 6% stake sale improves liquidity without hurting promoter control.

“There’s near-term supply pressure as the 6% divestment may push the stock toward ₹71-72 support. Unlike some OFS, there’s no extra retail discount, just 10% reservation. Bottom line: if you’re investing for dividends and a 1-2 year horizon, ₹71-71.50 looks reasonable to participate,” Srivastava said.

Meanwhile, Mahesh M Ojha, VP Research & Business Development at Kantilal Chhaganlal Securities, also recommended 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.

“The zone is viewed as an attractive entry point, providing investors with the potential to benefit from future upside while limiting downside risk,” Ojha said.

NHPC shares: Tech view

Virat Jagad, Sr. Technical Research Analyst at Bonanza, said that NHPC remains in a weak-to-neutral technical structure as the stock continues to trade below a longterm descending trendline, indicating that the broader trend is still under pressure.

“The recent sharp decline on exceptionally high volumes suggests aggressive selling activity and a breakdown of short-term support near 78. The stock is currently trading below its key moving averages, with the 20, 50, 100, and 200-day EMAs acting as immediate resistance zones. Momentum indicators are also unfavourable, with RSI slipping below 45 and remaining below its signal line, reflecting weakening buying strength,” he added.

Jagad finds immediate support near 72–73, while resistance is seen around 78–80. He added that a sustained move above 80 would be required to improve the technical outlook and open the possibility of a recovery towards 84–86. “Until then, the stock may continue to witness volatile and range-bound price action with a cautious bias.”

Disclaimer: This story is for educational purposes only. The views and recommendations above are those of individual analysts or broking companies, not Mint. We advise investors to check with certified experts before making any investment decisions.