Tata Power Company Ltd. share price target

The Tata Power Company Limited generates and supplies electricity. The Company constructs and operates independent power plants, as well as specializes in transmission and distribution of electricity. It delivers its...

Tata Power's (TPWR) 1QFY20 consol. operational performance (EBITDA and PAT of JVs) increased 19% YoY to INR23.4b, led by a better performance of the MundraCoal JV hedge and Maithon. Adj. PAT increased 19% YoY to INR2.6b (in-line). Mundra (EBITDA) and coal JVs (PAT) increased 27% YoY to INR4.2b. Given the decline in coal prices, there was no significant impact of DMO obligation for its JVs. Further, tariff escalation at Mundra on account of timing difference also lowered its under-recoveries, in our view. RE (ex-standalone) EBITDA increased 10% YoY to INR5.4b, led by a 21% YoY...

28 January 2019 Tata Power (TPWR) reported a loss of INR1.1b on a consolidated basis in 3QFY19, as against a profit of INR2.7b in the previous quarter and our estimate of INR2.9b. The performance was dragged by a higher-than-expected cost increase, lower realization at the coal JV, and a rise in under-recoveries at Mundra. PAT is adjusted for an INR2.7b gain on deferred tax reversal and an INR0.3b loss from discounted operations. Operational performance (EBITDA and PAT of JV companies) was declined 64% QoQ. The hedge between the two was impacted by a sharp increase in COGS, lower realization at coal JVs due to mix, Indonesias DMO impact, and some one-offs. Mundra under- recoveries increased INR0.13/kWh QoQ to INR0.95/kWh. Mumbai EBITDA (proxy standalone) was steady QoQ, while Delhis PAT increased 68% QoQ, aided by consultancy income. Regulated equity was broadly flat QoQ in both the circles.

After about a year-long competitive bidding process, BEST DISCOM found it economical to extend the existing PPA with Tata Power's Trombay and hydro power plants due to transmission constraints in Mumbai. Mumbai distribution circle relies heavily on embedded generation.

29 October 2018 Tata Powers (TPWR) 2QFY19 consol. PAT declined 28% YoY (+25% QoQ) to prior-period revenue of ~INR0.9b, net of loss on discontinued operations of ~INR0.3b. Operational performance (EBITDA and PAT of JV companies) was in line. increased 25% QoQ to INR4.1b, driven by INR depreciation, higher coal prices and savings from blending of low-GCV coal at Mundra. Indonesias DMO obligation impacted coal JVs PAT by ~INR0.6b. Cost of production in coal JVs is rising, which could offset gains from higher prices. Regulatory assets declined by ~5% QoQ to INR41b, aiding working capital improvement in Delhi. RE EBITDA increased 8% YoY (-7% QoQ) to INR4.6b, driven by an increase in generation by 34% YoY.

Underlying earnings (that is, PBT before exceptional and other income, but including PAT of JVs and associates) grew ~8% in FY18. The benefit of higher coal prices (net) and almost doubling of renewable energy (RE) business was largely offset by higher finance cost. Finance cost increased due to leveraged acquisition of RE business from Welspun (was for part of the year in FY17) and FX loss

Consolidated revenue grew by 16% YoY to Rs71.4bn vs. Rs61.6bn, while PAT quadrupled to Rs17.3bn vs. Rs4bn. CGPL's loss rose to Rs4.3bn from Rs3bn in 1QFY18 on higher fuel cost and Rs0.98bn MTM loss led by INR depreciation. However, CGPL's revenue rose by 19% YoY to Rs15.3bn on higher realisation (at Rs2.7/unit vs. Rs2.3/unit in 1QFY18) & improved PLF (66% vs. 59% in 1QFY18). Despite 3.5% YoY decline in coal sales to 13.9mnT, net realisation FOB remained flat at US$64.8/tonne, while gross profit declined to US$19.8/tonne from US$22.8/tonne in...