The brokerage expects steady growth for the company in the coming years, despite some delays in renewable energy (RE) project commissioning.
It estimates that underlying net debt-to-EBITDA will peak at 3.6x, which still leaves ample headroom for further expansion.
Key takeaways from Morgan Stanley’s note:
– Renewable energy (RE) capacity additions are projected at 1.7 GW in FY26, 1.8 GW in FY27, and 2.9 GW in FY28.
– The green energy segment is expected to contribute 58% of EBITDA by FY28.
– Morgan Stanley forecasts EBITDA and PAT CAGRs of 15% and 14%, respectively, over FY25–FY28.
– Return on Equity (RoE) is expected to improve by 90 basis points, reaching 13.8% by FY28.
– Net debt-to-EBITDA is expected to peak at 3.6x (vs 3.1x in FY25).
Tata Power posted a 24% rise in its consolidated net profit to ₹1,306 crore, compared to ₹1,045.6 crore in the year-ago period. Its revenue increased nearly 8% to ₹17,096 crore.
The company’s earnings before interest, taxes, depreciation, amortisation (EBITDA) surged 39% to ₹3,245.4 crore, while its operating margin expanding to 19% from 14.7% in the year-ago period.
Of the 23 analysts tracking Tata Power, 13 have a ‘Buy’ rating, three have a ‘Hold’ rating and seven have a ‘Sell’ rating.
Shares of Tata Power Company Ltd. are trading with gains of 1.47% at ₹401.40 on Friday. The stock is up 2% on a year-to-date basis.
