Tata Power's market cap surpasses Rs. 1 lakh crore
Tata Power's stock jumped almost 13% to Rs. 332.15 on the National Stock Exchange (NSE) on Thursday, boosting its market capitalization beyond the Rs. 1 lakh crore mark. This achievement makes Tata Power the sixth company from the Tata Group to reach this milestone. The surge was backed by strong trading volumes, with over 15 crore shares being traded. At the end of the trading session, Tata Power's market cap was Rs. 1,04,104.16 lakh crore.
JM Financial upgrades Tata Power to 'Buy'
The stock's impressive performance came after brokerage firm JM Financial upgraded Tata Power's rating to 'Buy' and set a sum-of-the-parts (SOTP) target price of Rs. 350. According to JM Financial, Tata Power's revamped strategy focuses on high-margin group captive renewable energy (RE) opportunities, exiting low-value businesses, exploring brownfield pumped hydro storage, and expanding its transmission business beyond distribution.
Accelerated growth expected for Tata Power
JM Financial predicts that Tata Power will experience accelerated growth due to its updated strategy and the "visible resolution of the Mundra issue." The brokerage firm projects revenue, EBITDA, and PAT CAGRs of 15%, 23%, and 32%, respectively, from FY23-26, supported by a growing asset base and improved margin profile. Other Tata Group companies with market caps over Rs. 1 lakh crore include TCS, Titan, Tata Motors, Tata Steel, and Trent.
Tata Power's pumped storage plants strategy
Tata Power recently held an analyst day at its Bhivpuri Hydro Power plant to discuss its pumped storage plants (PSP) strategy. The company signed an MoU with Maharashtra government and plans to implement 2.8 GW of PSP at Bhivpuri (1 GW) and Shirawta (1.8 GW) in Raigad district by FY28, with a capex of Rs. 13,000 crore. Additionally, the management has identified a potential 9 GW of PSP, which could support round-the-clock power supply of 30 GW in Maharashtra alone.
