Tata Power's execution timelines in spotlight

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Subscribe to enjoy similar stories. MUMBAI : Tata Power Co. Ltd's shares have had a stellar run in the past year, soaring as much as 77% compared to the 25% returns of the Nifty50.

One factor driving investor sentiment is the improved outlook on the back of the ramp-up in the solar module manufacturing plant and commissioning of the solar cell production plant. Recently released September quarter (Q2FY25) results show that ramped-up solar manufacturing and lower fuel costs were instrumental in the company reporting better-than-expected consolidated Ebitda of ₹3,745 crore, up 21% year-on-year. Ebitda is earnings before interest, taxes, depreciation, and amortization.

Tata Power’s current generation capacity is about 15 gigawatts (GW), including 6.4GW of renewable energy (RE). The company has increased its focus on RE across the entire value chain of solar manufacturing, EPC (engineering, procurement and construction) projects and generation. It is undertaking construction of 6.5GW of RE capacity to be commissioned by FY26-end.

In Q2FY25, Tata Power’s module manufacturing plant achieved 100% capacity utilization and is now fully operational. Moreover, one solar cell production line was commissioned last quarter, and the second is expected to be commissioned by December. Tata Power’s consolidated revenue declined marginally last quarter due to lower power demand.

The management projects higher power consumption in Q3 amid a harsher winter season. The RE segment, including solar EPC and manufacturing plants, clocked nearly 33% growth in Ebit (earnings before interest and tax) in Q2, taking its share in total to about one-fourth. Transmission and distribution Ebit, forming one-third of total, rose sharply by 42% aided by a