NHPC OFS 2026: Retail Bidding Opens, Stock Jumps 5%

What triggered the move in NHPC shares

NHPC shares climbed more than 5% on Wednesday as the government’s offer for sale (OFS) opened for retail investors, a day after strong institutional bidding. The retail window follows an oversubscription of 3.47 times on Day 1, which prompted the government to exercise the green shoe option. The move put NHPC in focus even as broader market conditions were described as weak in parts of the day. The OFS is part of the Centre’s plan to divest up to a 6% stake in the state-run hydropower producer. The issue structure includes a base offer and an additional portion that can be sold if demand remains strong. The floor price and the discount to recent market prices were central to the sharp swings in the stock over two trading sessions.

Timeline: from announcement to retail bidding day

The central government announced the OFS on June 1, setting up a two-day bidding process. Non-retail investors could bid on Tuesday, June 2, while retail investors and eligible employees could participate on Wednesday, June 3. DIPAM Secretary Arunish Chawla said on X that the OFS was oversubscribed 3.47 times on the first day and that allocation would be on a price priority basis. He also confirmed that the government decided to exercise the entire green shoe option, increasing the stake sale to the full 6% on offer. NHPC also communicated operational details including the T Day and T+1 Day bidding framework under the SEBI OFS circular.

Offer structure: base size and green shoe option

NHPC said the government aims to sell 3% of the company’s total paid-up equity capital as part of the base offer. It also included an oversubscription option to sell an additional 30 crore shares. If the green shoe is fully exercised, the total offer size rises to 60.27 crore shares, or 6% equity. The decision to use the green shoe came after strong bidding from non-retail investors on the first day. The OFS is described as the government’s third stake sale in a PSU during the current financial year, and also referenced as the third OFS of FY27 in one report.

Pricing: floor price and the implied discount

The floor price for the NHPC OFS was set at ₹71 per share. Reports cited this as roughly a ₹4 per share discount to a Monday close referenced at ₹75, and also as a 7.85% discount to Monday’s closing price of ₹77.05 per share in another market update. The discount became a key factor for near-term sentiment, with NHPC shares falling sharply on Tuesday after the OFS opened for non-retail investors. The discount framing varied slightly across market references, but the floor remained ₹71.

Subscription data: what happened on Day 1

Stock exchange data showed the non-retail portion received bids of 347.37% of shares on offer, or 3.47 times subscription, by the close of bidding on Tuesday. DIPAM’s secretary described the response as “enthusiastic” and reiterated that allotment would be on a price priority basis. Following the 3.47 times subscription, the Centre decided to offload additional shares via the green shoe option. This effectively increased the divestment to the entire 6% that was available under the OFS structure.

Who can bid: retail limits and employee participation

Retail investors were allowed to participate on June 3, with eligibility defined as bids for OFS shares of total value not more than ₹2,00,000. Employees were also eligible to bid on the retail day, alongside non-retail investors who carried forward unallotted bids from T Day to T+1 Day. NHPC said that employees and non-retail investors who carried forward unallotted bids could revise their bids on T+1 Day, in line with the SEBI OFS circular. One report also stated that around 10% of the issue is reserved for retail participants, improving access for smaller investors.

Stock price action: fall on Tuesday, rebound on Wednesday

NHPC shares declined sharply on Tuesday after the OFS opened for non-retail investors, with multiple updates pegging the fall between more than 4% and as much as 6% during the session. One market snapshot said the stock fell nearly 5% to ₹73.42 on Tuesday, while another update noted trading around ₹73.23 at 11:00 AM on June 2, down 5.13% versus the previous close. On Wednesday, the stock opened at ₹75.56 compared with a previous close of ₹72.29. In morning trade, NHPC was quoted at ₹75.35 on the NSE at 10:00 IST, up ₹3.06 or 4.23%. Another update said the stock rose as much as 4.99% to ₹75.90.

Key numbers at a glance

How much the OFS could raise for the government

At the floor price of ₹71 per share, one estimate put the potential proceeds at more than ₹4,279 crore if the full 6% is sold. Another report said the issue is expected to generate approximately ₹4,200 crore for the government. A separate estimate suggested the total OFS size could reach approximately ₹4,820 crore if fully subscribed. These figures are tied to the final quantity sold under the base offer and the green shoe option, and to the realized clearing price relative to the floor and bids received.

Market impact and why this matters

The 3.47 times subscription on Day 1 signaled strong non-retail demand, which directly led to the exercise of the green shoe option and expanded the divestment to the full 6%. At the same time, the floor price discount weighed on the stock on Tuesday, showing how pricing decisions can pressure secondary market prices during large stake sales. The rebound on Wednesday, with the stock rising above ₹75 in early trade after Tuesday’s drop, highlighted renewed focus as retail investors and employees entered the process. The OFS also affects the government’s holding, which was reported at 67.4% at the end of the March quarter, and is part of a broader divestment program through PSU stake sales.

Conclusion

NHPC shares moved sharply around the government’s two-day OFS, falling on June 2 after the ₹71 floor price signaled an 8% discount in some market comparisons, and rising more than 5% as retail bidding opened on June 3. With Day 1 demand at 3.47 times, the Centre exercised the green shoe option to sell the full 6% on offer. The next key step is the completion of the retail bidding window and allotment based on price priority, as outlined by DIPAM and NHPC.