Tata Power shares hit fresh record high; here's what analysts say

Shares of Tata Power Company Ltd rose 1.53 per cent to scale their new all-time high of Rs 387.75 in Tuesday's trade. At this price, the multibagger stock has gained 112.52 per cent from its one-year low of Rs 182.45, a level seen on March 28 last year.

Tata Power's subsidiary -- Tata Power Renewable Energy -- has successfully commissioned a pioneering 1040 kW Bifacial Solar System project with Chengmari Tea Estate, Asia's largest tea estate. The company said it is "the first-ever installation of on-ground bifacial modules in eastern India."

Technical analysts largely suggested optimistic views on the counter. "The stock has seen a very significant upmove. It is looking positive but one should not be aggressive in buying. Wait for some dip or profit-booking," Osho Krishan, Senior Research Analyst - Technical & Derivatives at Angel One, told Business Today TV.

Separately, a market expert has selected Tata Power shares as his top pick from the renewable energy space following the announcement of Pradhanmantri Suryodaya Yojana. "Tata Power is a very good play on the solar roof-top story. It is purely a direct play in this sector," Vinit Bolinjkar, Head of Research at Ventura Securities, said during an interaction with BT TV last week.

The government has announced PM Suryodaya Yojana with a target of installing roof-top solar on 1 crore houses.

Analysts from domestic brokerages also remained positive on Tata Power. India Ratings and Research upgraded the rating of the Tata Group firm's long-term issuer rating from 'IND AA' to 'IND AA plus', and maintained the stable outlook.

IIFL Securities has upgraded Tata Power to 'Add'. "Tata Power stands out with its diversification strategy. We assume extension of section 11 for Tata Mundra until FY26, for which earnings move up by 32-45 per cent on unchanged coal prices. Tata Power is also benefited on two fronts: 1) likely pick up in power demand benefiting some of the IPPs which have unfavourable economics; 2) improvement in consumption plus lower AT&C losses leading to superior earnings in the distribution segment," said IIFL Securities.

Brokerage Sharekhan expects the stock to touch the Rs 390 mark. "Tata Power plans to install 1.5-2 GW of renewable energy every year with a target to increase its renewable power portfolio to 70% of total portfolio by 2030. The company has set an aggressive growth target for next 3 years with Revenue/EBITDA/PAT expected to double by FY27 with 90% of PAT coming from core business (versus 40% in FY23) by FY27E," the brokerage said.

Analysts at Antique Broking has raised their target price for Tata Power's stock to Rs 450 from Rs 422 earlier.

(Disclaimer: Business Today provides stock market news for informational purposes only and that should not be construed as investment advice. Readers are encouraged to consult a qualified financial advisor before making any investment decisions.)

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