BENGALURU (Reuters) – India’s Tata Power Company on Wednesday reported a more than 22% jump in first-quarter profit, led by robust growth in its transmission and distribution segment.
Consolidated net profit rose to 9.72 billion rupees ($117.4 million) for the quarter ended June 30, compared with 7.95 billion rupees a year ago, the energy arm of the Tata conglomerate said.
Revenue from operations increased nearly 5% to 152.13 billion rupees, helped by a 3.6% growth in the transmission and distribution segment – the company’s largest business.
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KEY CONTEXT
Rising temperatures since the start of April in India have led to a strong summer demand for electricity, which coupled with late monsoons, resulted in an increase in the usage of fans and air conditioners.
To cater to the demand, the government in June directed all power plants operating on imported coal, including those owned by Tata Power, to operate at full capacity till the end of September.
PEER COMPARISON
Valuation (next 12 Estimates (next 12 months) Analysts’ sentiment
months)
RIC PE EV/EBITDA Revenue Profit growth Mean # of Stock to Div yield
growth rating* analysts price (%)
target**
Tata Power Company 20.68 11.73 7.19 145.97 Hold 22 1.07 0.86
Ltd
Torrent Power Ltd 13.58 8.13 -0.86 6.05 Hold 8 1.19 1.97
NTPC Ltd 10.54 8.36 4.66 17.54 Strong 15 0.92 3.33
Buy
CESC Ltd 6.81 6.39 11.72 11.07 Strong 10 0.79 8.62
Buy
* The mean of analyst ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell
** The ratio of the stock’s last close to analysts’ mean price target; a ratio above 1 means the stock is trading above the PT
APRIL-JUNE STOCK PERFORMANCE
— All data from Refinitiv
— $1 = 82.8270 Indian rupees
(Reporting by Hritam Mukherjee in Bengaluru; Editing by Sonia Cheema)
