NHPC Ltd Experiences Financial Trend Shift Amidst Strong Operating Metrics and Rising Leverage

NHPC Ltd, a midcap player in the power industry, has recently undergone a financial trend adjustment, reflecting a flat performance for the quarter ending September 2025. The company's score has seen a decline over the past three months, indicating a shift in its financial dynamics.
On the positive side, NHPC has reported robust operating metrics. The operating profit to interest ratio stands at an impressive 7.30 times, showcasing strong profitability relative to its interest obligations. Additionally, the company achieved a net profit after tax of Rs 2,940.10 crore for the nine-month period, with net sales reaching Rs 3,365.26 crore and a PBDIT of Rs 2,026.87 crore, all marking the highest figures for the quarter. The operating profit to net sales ratio is also noteworthy at 60.23%, indicating effective cost management.

However, challenges persist, particularly with a return on capital employed (ROCE) of just 6.50%, which is the lowest in the half-year period. Furthermore, the debt-equity ratio has risen to 1.09 times, suggesting increased leverage.

In terms of market performance, NHPC's stock has shown mixed results compared to the Sensex. Over the past year, NHPC has returned 5.27%, while the Sensex has outperformed with a return of 9.03%. Notably, NHPC has demonstrated significant growth over longer periods, with a remarkable 348.52% return over the last decade, compared to the Sensex's 230.75%. This long-term performance highlights the company's resilience in the power sector despite recent challenges.