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Tata Power valuations could drag the stock lower by another 12% after Q4 results, CLSA saysOf the 23 analysts that have coverage on Tata Power, 13 have a "buy" rating, three have a "hold" rating and seven have a "sell" rating.By Shloka Badkar   May 15, 2025, 12:02:21 PM IST (Published)2 Min ReadShares of Tata Power Ltd. are witnessing choppy trade on Thursday, May 15 after the company reported its March quarter earnings after market hours a day prior, and brokerage firm CLSA projected a 11.5% downside on the stock from its previous closing price.

CLSA has a "underperform" rating on Tata Power with a price target of ₹351 per share. The stock ended Wednesday's trading session at ₹396.95 apiece.

The brokerage said Tata Power's fourth quarter earnings were weak, with Indonesian coal mines, the renewable energy (RE) independent power producer (IPP) business and Tata Projects, dragging the company's net profit lower by 5% from the previous year.

CLSA also said that Tata Power's Renewable Energy Independent Power Producers (IPP) business remains impacted, as wind utilisation rates fell and interest rates rose. The RE IPP business is a key catalyst for Tata Power's prospects, according to CLSA.

Profit per tonne for the coal business also halved from the same quarter last year due to a fall in seaborne coal prices.

Tata Power's solar module business was the only bright spot that did well because of India's ban on solar module imports.

At the current price, Tata Power's shares are trading at 26 times financial year 2026 price-to-earnings, which according to CLSA, is expensive.

Of the 23 analysts that have coverage on the stock, 13 have a "buy" rating, three have a "hold" rating and seven have a "sell" rating.

Tata Power reported a 24% increase 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) gained 39.2% to ₹3,245.4 crore, while its operating margin expanding to 19% from 14.7% in the year-ago period.

Tata Power shares declined 1% to hit an intraday low of ₹392.65 apiece. The stock has gained nearly 5% in the past month.

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