Tata Power shares fall 2% as Singapore Tribunal asks company to pay $498 mn to Kleros

Tata Power shares fall 2% as Singapore Tribunal asks company to pay $498 mn to Kleros

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26 Aug, 2025 12:21

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Tata Power shares fell 2% on July 3 after the company said it has been directed to pay $498 million in damages to Kleros Capital Partners by an arbitral tribunal under the Singapore International Arbitration Centre (SIAC) rules.

The ruling deals a setback to the company, sparking investor concerns over potential financial impact.

At 10:13 am on July 3, Tata Power's shares were trading 2% lower at Rs 398.45 apiece. The 52-week low of the stock is Rs 326.35 and 52-week high is Rs 494.85. The market capitalisation of the stock is Rs 1.27 lakh crore.

The partial award, issued by a 2:1 majority decision, includes simple interest at an annual rate of 5.33% from November 30, 2020, until the payment is made. Additionally, Tata Power has been directed to pay $8.29 million in legal expenses, also accruing interest at 5.33% per annum starting from July 1, 2025.

The case pertains to Tata Power's Russian mining partner Kleros Capital Partners Ltd., where Kleros claimed that Tata Power breached confidentiality and non-circumvention clauses in their Non-Disclosure Agreement, which was signed for a proposed coal mining project in Russia.

The company said in a regulatory filing that it is reviewing the award and may pursue legal options to challenge it.

Tata Power reported a 24% YoY rise in net profit in Q4FY25 at Rs 1,306 crore, with revenue increasing 7.9% at Rs 17,096 crore. EBITDA jumped 39.2%, and margins improved to 19%. Operating margins expanded to 19% from 14.7% in the year-ago period.

Tata Power’s board has recommended a final dividend of ₹2.25 per equity share for FY25. The dividend is subject to shareholder approval at the company’s 106th Annual General Meeting (AGM), scheduled for July 4, 2025.