NLC India Share Price Jumps 9% After Q4 Profit Quadruples | Stock Up 17% in May

NLC India Share Price Soars 9% After Q4 Net Profit Jumps Four-Fold; Up 17% in May Rally

In a bullish surprise for investors, NLC India Ltd, a state-owned Navratna enterprise, witnessed a sharp 9% surge in its share price after the company posted a remarkable four-fold increase in its net profit for the fourth quarter of FY2023-24. Riding on the back of robust operational performance, higher power generation, and a one-time gain, the PSU's stock is now up over 17% in the month of May alone, making it one of the top-performing public sector stocks on the NSE.

Let’s decode what led to this rally, the fundamentals driving this turnaround, and what lies ahead for the stock.

About NLC India: A Brief Introduction

Formerly known as Neyveli Lignite Corporation, NLC India Ltd is a government-owned mining and power generation company, primarily engaged in lignite mining and thermal power generation. Over the decades, the company has grown into a major energy player with a diversified portfolio that includes:

• Lignite Mining

• Coal-Based Power Generation

• Renewable Energy Projects

• Solar and Wind Power Initiatives

It operates under the Ministry of Coal and has a reputation for being a consistent dividend-paying company with stable operations.

Q4FY24 Highlights: Profit Jumps Over 300%

In its latest financial results for the quarter ending March 2024, NLC India delivered numbers that stunned the Street.

Here are the key figures:

• Net Profit: ₹1,049 crore vs ₹274 crore YoY (Up 283%)

• Revenue from Operations: ₹4,245 crore vs ₹3,129 crore YoY (Up 35.7%)

• EBITDA: ₹1,634 crore vs ₹819 crore YoY (Up 99.5%)

• EBITDA Margin: 38.5% vs 26.2% YoY

• EPS (Quarterly): ₹7.2 vs ₹1.9 YoY

What drove this massive jump?

• Improved coal availability and efficient capacity utilization at thermal power stations

• Higher merchant power sales during peak summer demand

• Reduction in finance costs

• A one-time tax benefit arising from deferred tax adjustments

This exceptional performance helped the stock break past short-term resistance levels.

Stock Performance: Up 17% in May, Hits 52-Week High

Following the Q4 results, NLC India's share price jumped 9% intraday, reaching a new 52-week high of ₹147.20. The PSU stock had already been building momentum in May and is now up over 17% month-to-date, outperforming the broader Nifty PSU index.

Key technical observations:

• RSI (Relative Strength Index) crossed 75, indicating strong bullish momentum

• Volumes surged 4x compared to the 30-day average

• The stock has broken out from a flag pattern, hinting at more upside

Analysts believe that a sustainable close above ₹150 can open the gates toward ₹165–₹170 in the near term, especially if coal availability remains consistent during the monsoon transition.

What’s Fueling the Rally?

Several factors are working in NLC India’s favor right now:

 1. Strong Q4 Financials

The results clearly show an operational turnaround. Cost control, better plant load factor (PLF), and improved efficiency across segments led to margin expansion.

 2. Higher Power Demand

As India gears up for an intensely hot summer, power demand is soaring. This favors PSU power producers like NLC, which can sell excess generation in merchant markets at attractive rates.

 3. Green Energy Push

The company has committed to adding 4,000+ MW of renewable capacity by 2030. Government support and policy tailwinds are positioning it as a future-ready player.

 4. PSU Re-Rating Theme

Investors are increasingly rotating into undervalued PSU stocks, betting on structural reforms and higher dividend yields. NLC’s dividend track record only boosts this narrative.

Management Commentary: Optimism Ahead

Speaking on the Q4 performance, NLC India’s CMD, Prasanna Kumar Motupalli, stated:

“We are moving towards becoming a more diversified and green-oriented energy utility. The strong Q4 performance reflects operational excellence and our commitment to expanding our clean energy footprint.”

The company is planning:

• To commission 1,000 MW solar projects in Rajasthan by FY25

• Enter new joint ventures in coal mining and lignite-based gasification

• Implement AI-driven plant efficiency solutions

This signals long-term strategic thinking, which bodes well for fundamental investors.

Valuation Snapshot

Even after the recent rally, NLC India remains attractively valued compared to sector peers.

At a forward P/E of under 10x, the stock trades at a steep discount to other energy peers, making it a compelling PSU bet for value-conscious investors.

Expert Take: What Analysts Say

Brokerage firms are taking note of the turnaround:

• Motilal Oswal: Reiterated BUY with a revised target of ₹165, citing a positive surprise on margin expansion.

• ICICI Direct: Raised FY25 EPS estimates by 20% and expects higher capacity utilization during peak summer.

• Nuvama Wealth: Called NLC India a “dark horse among PSUs” due to its diversified asset base and renewables push.

Should You Buy NLC India Stock?

Before jumping in, here are the pros and cons for investors:

 Pros:

• Strong earnings growth and margin expansion

• Low valuation and high dividend yield

• Energy demand tailwinds and renewables pipeline

• Government backing and low debt

 Cons:

• Still heavily dependent on coal and lignite

• Regulatory and environmental risks

• Execution risks in solar and wind projects

Investor Tip:
Use dips as an opportunity to accumulate. Keep a medium to long-term horizon. The PSU sector is witnessing a sentiment shift, and NLC is well-positioned within that basket.

Outlook: Can the Rally Sustain?

Here’s what could keep the momentum alive:

• Continued strength in merchant power rates

• Smooth execution of solar projects

• More institutional participation, including mutual funds and ETFs

• Policy tailwinds such as faster clearances for green projects

Short-term resistance lies near ₹150, and if that breaks, a fresh leg of rally could take it toward ₹170–₹180 by Q2FY25.

On the downside, ₹128–₹130 could act as strong support, making the risk-reward attractive for long-term investors.

NLC India’s Breakout Quarter Signals More Than Just a Bounce

With a massive four-fold surge in quarterly net profit, renewed focus on green energy, and bullish price action, NLC India has sent a strong signal to the market—this PSU stock is no longer flying under the radar.

Whether you're a conservative investor looking for dividend stability or a growth-seeker betting on India’s energy story, NLC India offers a rare mix of both. The recent rally may just be the beginning of a larger PSU re-rating cycle, with NLC well-poised to benefit from both tailwinds and transformation.

For now, the Street is clearly energized—and so is this power PSU.