At NSE, the stock nosedived by 29.92 per cent to Rs 18.15.
NHPC shares tanked 25.87 per cent to Rs 17.90 on the BSE.
Following the steep decline in the share price, the company's market capitalisation got eroded by Rs 5,597 crore to Rs 24,109 crore.
In a clarification to the BSE, NHPC said, "As far as the fundamentals of the company, there is no change which affects the major price movement. In our opinion, there is no issue in the Finance Bill which has any adverse effect on hydro sector."
In the broader market, the BSE benchmark Sensex was trading at 18,873.51, down 45.01 points in late afternoon trade.