ICICI Securities research report on Tata Power
Tata Power reported a good set of result in Q4FY25. EBITDA came in at INR 34.8bn (+27% YoY) driven by strong performance in renewables segment – solar manufacturing and renewable generation, coupled with strong show by Odisha discoms. Revenue was up ~7% YoY at INR 173bn, partly due to higher availability and generation in Mundra plant. Profit in Q4 stood at INR 10.4bn (+16.5% YoY). Its solar manufacturing capacity reported an excellent set of result – INR 15bn in revenue and INR 1.9bn in profit in Q4. Note that 4.3GW of solar cell capacity was commissioned in H2FY25 and once fully ramped up, it will further aid earnings. This, along with commissioning of new assets, is likely to drive growth in next 18-24 months. It is targeting to add 2.5-2.7GW of renewable capacity and 4 transmission projects with estimated EBITDA of INR 5.8bn in FY26.
Outlook
Maintain BUY with an SoTP-based TP of INR 470 (unchanged).
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