Shares of Tata Power Ltd will be in focus on Thursday after Moody's Ratings affirmed the Tata Group firm's corporate family rating (CFR) of Ba1 and changed the outlook to positive from stable. In another development, Tata Power has announced a MoU with the Assam government to develop up to 5,000 MW of renewable energy, including solar, wind, hydro, and energy storage, with a Rs 30,000 crore investment. The initiative is expected to create 3,000 direct jobs and boost clean energy adoption in Assam.
In the previous session, Tata Power shares fell 1.05% to Rs 351.05 on BSE. Market cap of the firm slipped to Rs 1.12 lakh crore.
The stock is neither oversold nor overbought on charts, signals its relative strength index (RSI), which stands at 45.4. In terms of price action, the stock is trading lower than the 5 day, 10 day, 20 day, 30 day, 50 day, 100 day, 150 day and 200 day moving averages.
Tata Power stock is down 10.54% this year. However, Tata Power shares rose 73% in two years. In five years, the stock delivered multibagger returns of 579%.
"The positive outlook is underpinned by Tata Power's strong financial performance and our expectation that the company is likely to maintain its stronger credit metrics with improved operating efficiencies in its regulated businesses and growing renewable generation portfolio," says Zi Zhu, a Moody's Ratings Analyst. Under its base case projection, Tata Power's CFO pre-WC/debt is projected to be in the range of 12%-15% over the next 2-3 fiscal years, which is around or exceeding our upgrade trigger of 13%. Over the next 12 to 18 months, we will assess the company's capital spending and financing plans and their impact on projected metrics, said Moody's.