Tata Power: Should you Buy, Sell or Hold after Q3 results?

Synopsis: Tata Power is in focus after its Q3 results, with revenue down 9.3% YoY to ₹13,948 crore and net profit up 0.5% YoY to ₹1,194 crore, along with brokerage views on the results and operations.

The shares of the Tata Group company specializing in the business of the generation, transmission, and distribution of electricity are in focus following their Q3 results, and let’s also see the analyst’s views post their result.

With a market capitalization of Rs. 1,16,086.69 Crores on the Day’s Trade, the shares of Tata Power Company Ltd declined by 2.8 percent, reaching a low of Rs. 360.85 compared to its previous close of Rs. 371.30.

What Happened

Tata Power Company Ltd, engaged in the business of generating, transmitting, and distributing electricity, is in the spotlight today as it has announced its Q3 results as follows:

Its Revenue from operations declined by 9.3 percent YoY from Rs. 15,391 Crores in Q3FY25 to Rs. 13,948  Crores in Q3FY26, and it decreased by 10.2 percent QoQ from Rs. 15,545 Crores in Q2FY26 to Rs. 13,948  Crores in Q3FY26.

Its Net Profit YoY rose by 0.5 percent from Rs. 1,188 Crores in Q3FY25 to Rs. 1,194 Crores in Q3FY26, and on a QoQ basis, it declined by 4 percent from Rs. 1,245 Crores in Q2FY26 to Rs. 1,194 Crores in Q3FY26. The earnings per share (EPS) for the quarterly period stood at Rs. 2.42, compared to Rs. 3.23  in the previous year’s quarter. Brokerage Views on the company

JPMorgan on Tata Power

JPMorgan maintains a Neutral rating on Tata Power with a target price of Rs 400, with an upside potential of 8 percent from the day’s close. JPMorgan says its weak quarterly results were primarily impacted by the Mundra loss, as the Mundra UMPP remained shut in 3Q and the power purchase agreement (PPA) is yet to be signed.

However, the performance was supported by healthy profits from DISCOM operations and the solar manufacturing business. Delhi and Odisha DISCOMs contributed positively through regulatory gains and operational turnaround, while the solar module and cell manufacturing segment saw a strong ramp-up and robust profitability, partially offsetting the Mundra-related drag.

Morgan Stanley on Tata Power

Morgan Stanley maintains an Equal-weight rating on Tata Power and has cut the target price to Rs. 399 from Rs 412, implying an upside potential of 7.4% from the day’s close. Morgan Stanleysays their Q3 was impacted by higher losses in the Mundra cluster and continued delays in renewable energy commissioning. 

The under-construction renewable portfolio maintains a balanced 50:50 mix of wind and solar capacity. Rising wafer prices could put the equity IRR at risk, while any further delay in resolving the Mundra issues would weigh on overall profitability. Earnings remain more sensitive to the performance of the green business, although leverage continues to be at comfortable levels.

Tata Power Company Ltd, part of the Tata Group, is one of India’s largest integrated power companies, established in 1911. It operates across power generation, transmission, and distribution, with a diversified portfolio including coal, hydro, gas, solar, and wind energy. The company serves millions of customers in India and abroad while actively investing in renewable energy and sustainable solutions, making it a key player in India’s transition toward clean energy.

Tata Power has a total capacity for power generation, including both operational facilities and those under construction, of 26,346 MW. This total is made up of 16,310 MW currently operational and 10,036 MW that is under construction, which is entirely clean and green energy.

The current operational capacity consists of various energy sources: 8,860 MW from thermal, 4,906 MW from solar, 1,221 MW from wind, 880 MW from hydro, and 443 MW from waste heat recovery or biofuel/gas (BFG). This diverse mix highlights the blend of traditional and renewable energy sources in use.

The transmission and distribution network serves 13 million customers, with 4,738 circuit kilometers of operational distribution lines. Additionally, there are 2,573 circuit kilometers of transmission lines, with more currently under construction to enhance the system’s capacity.

The company demonstrates strong financial performance with a decent Return on Capital Employed (ROCE) of 10.8% and Return on Equity (ROE) of 11.0%, reflecting efficient utilization of capital and shareholder funds. Over the past five years, it has achieved impressive profit growth, posting a CAGR of 45.5%, highlighting consistent operational strength and growth momentum.

Additionally, the company maintains a healthy dividend payout ratio of 18.9%, indicating a balanced approach between rewarding shareholders and retaining earnings for growth. Operational efficiency has also improved, with debtor days reducing from 40.6 to 31.8, signaling better cash flow management and quicker collections from customers.

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