Buy Tata Power; target of Rs 465: ICICI Securities

ICICI Securities research report on Tata Power

Tata Power (TPWR) is present across the power value chain – generation, transmission and distribution. TPWR has diversified its presence over the years – from its conventional thermal power and integrated Mumbai distribution business, the company is now building up its renewables portfolio with notable backward integration via in-house solar EPC and module/cell manufacturing. It has also turned around Odisha discoms post takeover in 2021. Taking its backward integration in solar manufacturing a step further, it is now planning to set up a 10GW solar wafer and ingot manufacturing. Further, it has a substantial execution pipeline of hydro/PSP and transmission projects.

Outlook

However, an old issue pertaining to its Mundra thermal plant has resurfaced. Its operations under temporary arrangements on cost-plus basis have been discontinued post Jun’25; it is working on a long-term agreement with PPA counterparties; this remains a monitorable. Maintain BUY with an SoTP-based TP of INR 465.