Rs 13,018 crore order book: TATA Group-multibagger solar microgrid power company announces Q1FY25 results & acquire 40 per cent stake in Khorlochhu Hydro Power Ltd
The stock is up by 97 per cent from its 52-week low of Rs 228.1 per share and gave multibagger returns of over 650 per cent in 5 years.
Tata Power Company Limited is set to acquire a 40 per cent equity stake in Khorlochhu Hydro Power Limited (KHPL), a Bhutanese power sector company, through one or more tranches. This cash-based acquisition, valued at approximately Rs 830 crore, aims to propel Tata Power's clean energy initiatives by developing the 600 MW Khorlochhu Hydropower Project in Bhutan, requiring a total investment of around Rs 6,900 crore. While not classified as a related party transaction currently, KHPL will become an associate company post-acquisition. The deal, which does not necessitate Indian governmental or regulatory approvals, is anticipated to be completed within six months for the initial tranche, with specific timelines outlined in the forthcoming Share Purchase Agreement. KHPL, incorporated in 2015, has yet to generate revenue but holds a net worth of Rs 592.21 crore as of December 31, 2023.
About Tata Power Company Ltd
Tata Power, a leading integrated power company under India's largest conglomerate Tata Group, boasts a diverse portfolio of 14,707 MW spanning the entire power spectrum. This includes the generation of both renewable and conventional energy, along with transmission, distribution, trading, storage solutions and even solar cell and module manufacturing. As champions for clean energy, they've committed to achieving carbon neutrality before 2045. Beyond generation, Tata Power has established India's most comprehensive clean energy platform, offering rooftop solar solutions, microgrids, storage solutions, EV charging stations and home automation systems.
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According to the Quarterly Results, the net sales increased by 13.3 per cent to Rs 17,540.98 crore in Q1FY25 compared to the total income of Rs 15,484.71 crore in Q1FY24. The company reported a net profit of Rs 1,188.63 crore in Q1FY25 compared to a net profit of Rs 1,140.97 crore in Q1FY24, an increase of 4.2 per cent. In its annual results, the net sales increased by 10 per cent to Rs 61,542 crore and net profit increased by 12 per cent to Rs 4,280 crore in FY24 compared to FY23. The company has delivered good profit growth of 75 per cent CAGR over the last 5 years and has been maintaining a healthy dividend payout of 23 per cent. The company's overall performance can be attributed to its effective management strategies.
With a robust order book of Rs 13,018 crore as of June 30, 2023, Tata Power is poised for an electrifying future. Tata Power Company Ltd is primarily involved in the business of the generation, transmission and distribution of electricity.
The company has a market cap of over Rs 1.30 lakh crore. The stock is up by 97 per cent from its 52-week low of Rs 228.1 per share and gave multibagger returns of over 650 per cent in 5 years. Investors should keep an eye on this mid-cap power stock.
Disclaimer: The article is for informational purposes only and not investment advice.
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