Tata Power plans to sell overseas assets to raise up to Rs 2,500 crore – EQ Mag
Shares of Tata Power Company slipped about 3 per cent during the early session on Friday amid media reports of monetisation of the various assets in the international markets. The Tata Group’s power arm is planning to raise up to Rs 2,500 crore by selling some of its assets overseas, including hydro assets in Zambia, and two coal mines in Indonesia.
The firm would also receive an additional Rs 1,200 crore from the sale of the strategic engineering division’s assets in the next two years, said media reports citing banking sources. The company is aiming to focus on its renewable energy projects which are looking to produce 20 gigawatts (GW) of electricity by 2027.
Shares of Tata Power dropped more than 3 per cent to Rs 215.65 on Friday as its total market capitalization slipped below Rs 70,000 crore. The scrip had settled at Rs 221.25 on Thursday. The stock has given up its all gains of 2023 so far, trading almost flat. Shares of Tata Power have delivered more than 675 per cent return from its covid-19 lows so far.
About a month ago, domestic brokerage firm Anand Rathi Shares and Stock Broking suggested to ‘buy’ the stock with a target price of Rs 256. “Tata Power continues to steadily move towards its long-term aspiration built on businesses of the future while maintaining a healthy balance sheet,” it said.
Recently, Tata Power received a ‘letter of award’ (LOA) to set up 966 MW of RTC (round-the-clock) hybrid renewable power for Tata Steel. Another brokerage firm, ICICI Securities, has a ‘buy’ call on the stock with a target price of Rs 262 apiece, implying nearly 20 per cent potential upside.
For the quarter ended on March 31, 2023, Tata Power has reported a consolidated net profit of Rs 939 crore for, up 48 per cent from Rs 632 crore clocked in the corresponding quarter of last year. Its consolidated revenue rose 6 per cent at Rs 12,755 crore against Rs 12,085 crore in Q4FY22 due to higher sales across distribution companies & capacity addition in renewables.
Tata Power on its quarterly charts had a massive up move post March 2020 quarter, from the levels of Rs 27 to the levels of Rs 298 in back-to-back nine quarters with huge volume. The stock witnessed a multiyear breakout on breaching the falling trend line of 13 years in March 2021, said Sujit Deodhar, Head Technical Analyst at Wellworth Share & Stock Broking.
Post a strong up move, this stock seems to be consolidating in the range of Rs 180-levels on lower side and Rs 280-levels on higher side with low volumes. Technical indicator MACD is still in buy mode above the zero line indicates underlying strength, he said.
“So structurally this stock is in strong uptrend & the current consolidation offers a great buying opportunity closer to support levels of Rs 180, for traders as well as investors. On the higher side of Rs 280 levels, traders are advised to book profits but for investors this stock is a ‘buy’ and ‘hold’ as the next leg of up move will head the stock to new highs with higher levels,” he added.
Tata Power has recently announced a dividend of Rs 2 per share which is almost 0.90 per cent of its current market price. It is trading at Rs 216 and retracted from Rs 226.50. Right Now, price is taking support at trendline and its tentative major support levels are Rs 215, Rs 201 and Rs 180, said according to VLA Ambala, a SEBI registered research analyst at Stock Market Today.
Currently, it is trading below its 20-days EMA and above 50-and-200-days EMA. RSI is showing 50 as of now. There is a probability that the price could trade in Rs 218 to Rs 208 range in the coming days. Those who are holding it can consider Rs 202.40 stop loss levels if they have a short-term holding view. One Price Strat trading above 220 range, target that we can expect in it are Rs 235, Rs 242, Rs 250, Rs 265, Rs 280 and Rs 300 in 3 months to 1 year time span, she added.
Source: PTI
