Tata Power Stock Swings After Delivering Mixed Bag Second Quarter
Tata Power’s second quarter numbers missed analyst estimates
Shares of Tata Power Company Ltd., fluctuated between gains and losses after delivering a mixed set of second quarter earnings.
Net profit surged to Rs 336 crore for quarter-ended September, against a loss of Rs 95.87 crore during the corresponding quarter last year. The consensus of analyst estimates tracked by Bloomberg pegged the profit to come in at Rs 324 crore.
The profit boost was mainly backed by the performance of its wholly-owned subsidiary Coastal Gujarat Power Limited (CGPL).
Besides that, a strong operational performance by Tata Power’s international investment PT Kaltim Prima Coal (KPC), Indonesia’s leading coal company, also contributed to the profit figure.
The company’s total income from operations fell 6 percent to Rs 7,208.89 crore in the three-month period, as against Rs 7,666.3 crore a year earlier. The figure was marginally below analyst estimates of Rs 7,290 crore.
Earnings before interest, tax, depreciation and amortisation (EBITDA) of the power supply company fell 27 percent to Rs 1,461.60 crore, compared to Rs 2,008.04 crore year-on-year. Meanwhile, EBITDA margins fell 589 basis points to 20.3 percent from 26.19 percent.
Other Key Highlights
- Revenue from the power business fell to Rs 6,484.54 crore as against Rs 6,665.66 crore last year.
- Power business PBT fell to Rs 733.22 crore compared to Rs 1,139.46 crore in the year ago period.
- Together with its subsidiaries, Tata Power achieved generations of 13,634 MU’s of power from all its power plants.
- The company together with its subsidiaries and jointly controlled entities has an installed gross generation capacity of 10,477 MW.
- Tata Power Renewables Energy completed the acquisition of 100 percent shareholding in Welspun Renewables and its subsidiaries. This represents the largest transaction in the renewables space in India.
Tata Power said it has managed to improve profitability and maintained strong operational performance across all the business verticals.
With the gross installed generation capacity, of 10,477 MW and more than 2.2 million customers, we continue to be India’s largest integrated power player. Our subsidiaries continue to perform well despite challenging circumstances. We are confident that our strong growth trajectory will continue in the next quarter.Anil Sardana, managing director and CEO of Tata Power.
Tata Power’s topline was impacted mainly by the decline in revenue from power business while sharp rise in other expenses took a toll on its performance at the operating level, Alok Deora, associate VP of IIFL Private Wealth told BloombergQuint. He said the net performance was positively impacted by lower interest expenses during the quarter.
“While the overall performance has been weaker than expected, the outcome of CERC on compensatory tariff would be a key determinant,” he said.
At 10:16am, Tata Power stock was up 0.6 percent at Rs 72 apiece, after sinking as much as 1.8 percent in opening trade.