Tata Power Stock: Tata Power’s presence in the power sector is no longer limited to just electricity generation. The company is rapidly expanding into businesses such as transmission, distribution, and renewable energy. Consequently, investors are keeping a close watch on the company’s quarterly results and future growth plans.
According to SEBI-registered research analyst Amit Chatterjee (SEBI RA: INH000023366), there is potential for further upside in the stock from current levels.
Tata Power profit rose 11% YoY in Q1
The company’s revenue from operations for the April-June quarter rose by about 6 per cent YoY to Rs 19,051 crore, up from Rs 18,035 crore in the previous year.
The company’s EBITDA also increased by 8 per cent to reach Rs 4,249 crore. Total income stood at Rs 19,439 crore, an increase of around 6 per cent compared to the previous year. However, the Earnings Per Share (EPS) declined from Rs 4.26 to Rs 4.12.
Boosted by rising electricity demand
Rising electricity demand in the country is a major growth factor for Tata Power. According to the company, India’s power demand grew by approximately 8.5 per cent year-on-year during the June quarter.
The company projects that capital expenditure in the country’s transmission sector will amount to around Rs 9.2 lakh crore between FY25 and FY32.
Given this, new opportunities could emerge for Tata Power in the transmission and power-related infrastructure sectors.
Big bet on renewable energy
The company is also consistently increasing its investment in the renewable energy business. It has a capacity of approximately 12 GW in various stages of development, comprising 6.7 GW of utility-scale projects and 5.3 GW currently under implementation. In Q1, the company incurred its highest-ever quarterly capex of Rs 5,375 crore.
Additionally, the board has approved the issuance of NCDs, bonds, or other debt securities worth up to Rs 4,500 crore via private placement.
Tata Power Share Price Target: Entry at Rs 380, target up to Rs 500
According to SEBI-registered research analyst Amit Chatterjee, an investor could consider entering Tata Power around Rs 380 level with a 3-4 month horizon. His technical outlook suggests a stop-loss of Rs 280 and a potential target of Rs 480- Rs 500.
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