NHPC Ltd held its Q2 FY27 earnings call on November 04, 2026. Here's a quick read of what management said — performance, strategy, and the outlook ahead.
Subansiri Part-Commissioning Powers a Strong Quarter
Q2 FY 2026-2027 revenue of Rs.4,482 crore (+33% YoY) — driven by part commissioning of Subansiri Lower, higher Parbati-2 generation, and resumption of commercial operation of Teesta-5; H1 FY 2026-2027 revenue at Rs.8,291 crore (+26% YoY).
Q2 PAT of Rs.1,549 crore (+52% YoY) — H1 PAT at Rs.2,645 crore (+27% YoY); adding back the Rs.231 crore Teesta-4 provision, management confirmed adjusted Q2 PAT of ~Rs.1,700 crore, ~90% higher YoY.
Q2 PAF of 92.24% vs 78.58% in Q2 FY 2025-2026 — H1 PAF at 86.67% vs 81.10%; H1 generation of 23,741 MU (+14% YoY).
Subansiri cost step-up now in P&L — H1 finance cost doubled to Rs.1,162 crore (vs Rs.539 crore) and D&A rose to Rs.1,210 crore (vs Rs.877 crore) since part commissioning; other income fell ~31% to Rs.338 crore as the prior year included insurance claim income.
Incentives fell sharply — Q2 incentives of Rs.59 crore vs Rs.253 crore in Q2 FY 2025-2026 (secondary energy down 89%, PA-based incentives down 77%); H1 incentives down 47% to Rs.103 crore.
Water cess relief — generation expenses fell to Rs.552 crore in H1 FY 2026-2027 (from Rs.592 crore) after the Honorable High Court of Uttarakhand verdict in favor of NHPC removed water cess in Uttarakhand.
Four Stations Drove the Incremental Profit
Four power stations drove the major share of incremental Q2 PBT — per Director Finance Mahesh Kumar Sharma: Subansiri, Parvati 2, Parvati 3 and Teesta 5.
Parvati 2 swung Rs.380 crore YoY — Rs.215 crore PBT in Q2 FY 2026-2027 vs a Rs.164 crore PBT loss in Q2 FY 2025-2026; with Parvati 3 adding Rs.80 crore, the two delivered Rs.460 crore of incremental Q2 PBT. Parvati 2 lost Rs.149 crore at PBT level in FY 2025-2026 as a whole.
Subansiri contributed Rs.130-132 crore PBT in Q2 FY 2026-2027 — and generated ~300 million units above the proportionate design energy of its 4 commissioned units in H1, outperforming the normalized profit expected from 4 units.
Teesta-5 resumed commercial operation in July 2026 — 859 million units generated in Q2 FY 2026-2027 with top line of Rs.150-160 crore and PBT contribution of Rs.99-100 crore; the plant is limited to 9 months of generation in FY 2026-2027 after missing Q1.
H2 Teesta-V outlook is trend-based — management expects H2 FY 2026-2027 generation similar to Q2's 859 million units with profit of Rs.100-150 crore, cautioning that hydro generation is very difficult to estimate; last-5-years average is 70% of generation in H1, 30% in H2.
Parbati-2 and Subansiri Tariff Decisions Are the Near-Term Catalysts
Parbati-2 revenue recognized at 80% to date — Rs.500 crore (20% balance) unrecognized as of Q2 FY 2026-2027; the CRC's next hearing on 11 November 2026 (Q3 FY 2026-2027) is expected by management to be the final hearing, with the order expected soon after reservation.
Parbati-2 full-tariff economics (period unspecified) — expected AFC of ~Rs.2,400 crore on design energy of 3,125 million units at ~Rs.8.5/unit; regulated equity ~Rs.4,000 crore (30% of Rs.13,600 crore capital cost); expected PAT ~Rs.680 crore at 17% core ROE, with 4-5% additional incentive ROE at management's discretion in models; typical EBITDA margin of 60-65% of top line.
Subansiri interim tariff order reserved — petitions filed for all 8 units and updated for 4 commissioned units; revenue currently booked at 18% of the filed tariff petition (Subansiri and Parvati booked at 80% of cost).
Subansiri full economics — capital cost of Rs.30,000 crore with Rs.23,000-24,000 crore capitalized for 5 units; levelized tariff ~Rs.8/unit; expected AFC of Rs.5,500 crore on full commissioning; expected PAT of Rs.1,500-1,600 crore from FY 2028-2029 onwards (regulated equity ~Rs.9,000 crore, 17% core ROE plus 4-5% incentives).
NHDC PSP will be regulated (as of now) — given the JV structure with the Government of MP; the PPA with the Government of MP is still under discussion and not finalized; project cost estimated at Rs.5,200 crore (period unspecified) with tariff currently estimated at Rs.4.9/unit, below Rs.5 (period unspecified).
1,744 MW Guided for FY 2026-2027; Heavy Hydro Award Pipeline Ahead
Subansiri Lower (2,000 MW): 1,250 MW commissioned — 5 of 8 units (unit 5 on 23 October 2026); two more units targeted in FY 2026-2027 and the final unit expected by June 2027 (FY 2027-2028); anticipated cost Rs.30,072 crore with ~90% (Rs.26,900 crore) spent till September 2026 and no further cost increase anticipated.
FY 2026-2027 commissioning guided at 1,744 MW — 500 MW Subansiri, 624 MW Kiru, 120 MW Rangit; FY 2027-2028 to add 1,000 MW Pakal Dul and 250 MW Subansiri; a further 1,390 MW and 1,000 MW expected over the next 4 years.
Kiru (624 MW) at 92% progress — reservoir filling starting November 2026, all units targeted by March 2027 (FY 2026-2027); Pakal Dul (1,000 MW) at 89% progress with reservoir filling planned end-December 2026 and two units targeted by March 2027 (FY 2026-2027).
Dibang (Rs.31,876 crore) on track for February 2032 completion — all major contracts awarded, Nala diversion achieved, Rs.5,504 crore spent; management "100% sure" of the date. Teesta 6 (500 MW) at 74% progress with commissioning expected September 2029 (FY 2029-2030); tunnel work is the only hurdle.
New awards: Kamale (1,720 MW) CCEA approved at Rs.26,070 crore in April 2026 — JV with Government of Arunachal in formation; Etalin (3,097 MW) has all clearances with cabinet approval expected within ~2 months (Q4 FY 2026-2027); Savalkot (1,800 MW) PIB completed with CCA approval pending, possibly by December 2026.
Pumped storage: 18 GW of PSPs in DPR/PFR stage — across Maharashtra, Odisha, MP, Gujarat and Andhra; management is hopeful at least two PSPs start physical work in FY 2027-2028; the 640 MW Indira Sagar-Omkareshwar PSP tendering is initiated with work commencement hopeful in FY 2026-2027.
Evacuation risk seen as low — transmission for Arunachal hydro projects is the CTU's responsibility, with lines awarded via tariff-based competitive bidding run by PFC and REC timed to each project's commissioning date; management stated there is no problem in evacuating power from the Arunachal plants.
Solar Delays and a PPA Tie-Up Gap Cloud the RE Story
1,190 MW of RE capacity under construction guided to be 100% completed in FY 2027-2028 — commissioning has been delayed due to connectivity availability, which management noted all solar projects are facing.
Solar CPSU scheme progress — 300 MW Bikaner commissioned; 100 MW Andhra Pradesh expected by January 2027 (FY 2026-2027) and 600 MW Gujarat by November 2027 (FY 2027-2028); 40 MW Ganjam and 150 MW Kerala floating solar expected by March 2027 (FY 2026-2027).
ARIA PPA gap is material — NHPC, as a Renewable Energy Implementing Agency, has tendered ~20,000 MW of bids (also referenced 23,000 MW) and awarded 73 projects, but PPAs are signed for only 9,000 MW; management expects ~5,000-7,070 MW of additional PPAs (period unspecified), leaving ~5,000 MW that may remain untied (period unspecified).
States reluctant to commit to 25-year PPAs — resource adequacy plans have become unclear after energy demand patterns changed drastically over the past year; management is reworking the configuration of awarded ARIA projects and will not construct projects without PPAs to avoid an "unnecessary dent" on its finances.
No solar hive-off before commissioning — management will evaluate options on its solar/green energy portfolio only after commissioning, remaining bullish on RE diversification and citing the PSU precedent of NTPC diversifying from thermal into RE.
Rs.800 crore Etalin consideration unpaid — the consideration for the project transferred from HJVN to NHPC (under Ministry of Power direction) will be paid to SGVNL only after PIB approval, which management expects "anytime now"; both boards have approved the transfer.
Receivables normalized to Rs.1,159 crore as of 3 November 2026 — from ~Rs.4,300 crore at 30 September 2026 (vs ~Rs.2,500 crore at FY 2025-2026 year-end); only Rs.6 crore outstanding beyond 45 days and average debtor days at 51 days; CFO cited the 2023 Electricity Late Payment Surcharge rules: "beyond 75 days, we don't have a single penny pending."
Group debt of ~Rs.59,000 crore vs LTM EBITDA of ~Rs.7,000 crore — Rs.29,000 crore deployed in operational projects and Rs.20,000 crore in under-construction projects; since NHPC uses balance-sheet financing, construction debt does not burden operating cash flow.
EBITDA guided to reach Rs.10,000 crore — post full-year Subansiri Lower and Pakal Dul commissioning; management concurred that Pakal Dul, Kiru and Rangit come online in FY 2027-2028, affirming the ~Rs.10,000 crore run-rate.
Capex: FY 2026-2027 target of Rs.14,300 crore with Rs.6,500 crore achieved till Q2 — management hopeful given H2-weighted utilization (FY 2025-2026 closed at Rs.13,700 crore vs a Rs.13,000 crore target); FY 2027-2028 onward capex guided at Rs.14,000-15,000 crore per annum at consolidated level.
No fresh equity needed for FY 2027-2028 — management targets PAT of Rs.6,000-6,400 crore; with depreciation of Rs.3,000-3,500 crore, ~Rs.10,000 crore operating cash less ~Rs.1,800 crore dividend and Rs.2,000-3,000 crore debt repayment leaves ~Rs.4,000 crore+ annually for capex.
10-year capex projection of Rs.1,11,000 crore — with an equity requirement of Rs.40,000 crore (~Rs.4,000 crore per year), which management said internal resources are sufficient to fund.
Dividend and collections — FY 2025-2026 total dividend of 16.10% (Rs.1.61/share); H1 FY 2026-2027 collections from beneficiaries at Rs.5,126 crore (vs Rs.4,764 crore in H1 FY 2025-2026).
Disclaimer: This earnings call summary is published for educational and informational purposes only. It is not investment advice, not a recommendation to buy, sell or hold any security.
Powered by Cofacto — AI research platform for Indian stocks, every claim cited from primary filings