Tata Power Q2 Net Profit Rises 33% to ₹1,652 Cr; Brokerages Split on Targets
Tata Power posted 33% YoY Q2 FY27 net profit growth to ₹1,652 crore as revenue rose 26% to ₹19,886 crore. Citi targets ₹525 while CLSA holds at ₹415.
Key Takeaways
- Consolidated Q2 FY27 profit climbed 33% YoY to ₹1,652 crore on 26% revenue growth to ₹19,886 crore, anchored by utility-scale renewables (8.6 GW) and rooftop solar.
- An ₹11,871 crore board-approved 1,800 MW pumped storage project at Shirwata signals heavy long-term capex into grid-scale clean energy.
- Brokerages diverge on valuation: Citi keeps Buy at ₹525, whereas JPMorgan (₹423) and CLSA (₹415) stay cautious over solar EPC softness and rising leverage.
Tata Power shares gained roughly 2% on November 12 after the utility reported a 33% YoY jump in Q2 FY27 consolidated net profit to ₹1,652 crore (up from ₹1,245 crore in Q2 FY26), backed by resilient power distribution, solar manufacturing, and utility-scale renewable generation.
What Happened
- Top- and bottom-line beat: Consolidated revenue from operations rose 26.1% YoY to ₹19,886 crore (versus ₹15,769 crore a year earlier), while EBITDA reached ₹4,245 crore.
- Renewable scale-up: Operational utility-scale renewable capacity expanded to 8.6 GW, while cumulative rooftop solar installations crossed 5.12 GWp, reinforcing Tata Power's retail and commercial clean-energy footprint.
- Pumped storage capex: The board cleared an ₹11,871 crore investment for an 1,800 MW pumped storage project (PSP) at Shirwata, Maharashtra, targeting round-the-clock grid balancing.
- Brokerage split: Citi reiterated a Buy rating with a ₹525 target price, whereas JPMorgan maintained Neutral at ₹423 and CLSA kept Hold at ₹415, reflecting diverging views on capital intensity.
Q2 FY27 Financial Snapshot
| Metric | Q2 FY27 | Q2 FY26 | YoY Change |
|---|---|---|---|
| Revenue from Operations | ₹19,886 crore | ₹15,769 crore | +26.1% |
| Consolidated Net Profit | ₹1,652 crore | ₹1,245 crore | +32.7% |
| EBITDA (incl. other income) | ₹4,245 crore | — | Steady margin support |
| Utility-Scale Renewables | 8.6 GW | — | Anchors green mix |
Sector Context & Earnings Quality
Tata Power's transition from legacy thermal generation toward an integrated clean-energy utility—spanning solar cell and module manufacturing, rooftop EPC, distribution circles, and pumped hydro storage—continues to widen its earnings base. However, third-party solar EPC execution showed pockets of softness during the quarter, even as internal renewable additions and regulated distribution cash flows drove the 32.7% profit expansion.
Independent Analysis & Key Risks
- Strategic implication: Vertical integration across solar manufacturing and 1,800 MW of pumped storage positions Tata Power to capture higher-margin firm-dispatchable clean power tenders.
- Capex & leverage risk: Funding the ₹11,871 crore Shirwata PSP alongside ongoing renewable additions will elevate net debt, explaining why CLSA (₹415) and JPMorgan (₹423) remain cautious on near-term free cash flow.
- Execution & tariff risk: Any regulatory delays in tariff true-ups or sharp module-price deflation could compress near-term return ratios.
Disclaimer: This report is for informational purposes only and does not constitute investment advice.
Sources & References
- View sourceEconomic TimesNews Report
Tata Power shares rise 2% after Q2 results. Why brokerages are bullish despite target price cuts
- View sourceLivemintNews Report
Tata Power: Q2 renewable gains partly offset by weak solar EPC
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