Tata Power Share Price Gains After Power Purchase Deal in Gujarat; Maha, Raj Talks Underway | Time To Buy?

Tata Power Share Price Today: Shares of Tata Power Company Limited recovered after remaining pressure during Tuesday's intraday trading session. The recovery came after Tata Power announced the execution of a Supplementary Power Purchase Agreement for Tata Power Mundra Plant with GUVNL (Gujarat).

Tata Power share price was trading in red in the first half of the trading session, but made some recovery later in the day. The stock was trading 0.48% higher at Rs 388.8 per share on BSE with a market capitalisation of Rs 1,24,234.80 crore at 12:34 pm on Tuesday, March 24.

As Nifty and Sensex have corrected sharply over the past two to three weeks, several stocks are trading at discounted rates. Tata Power's share price has also declined 3.5% in one week.

Tata Power Share Price Recommendation

Losses at Tata Power Mundra Plant are likely to decline significantly by 75% from the current levels if the company can adopt the Supplementary Power Purchase Agreement for all states, as per a Motilal Oswal report released on Tuesday, March 24.

The ongoing US-Israel war on Iran has fuelled the coal prices across the world and Motilal Oswal estimates that the realisations for Tata Power's Indonesian coal business have "spiked ~USD10/t on average". It also " translates to an 18% upside" to Motilal Oswal's current FY27 PAT estimate.

Motilal Oswal maintained a 'Buy' recommendation for the stock.

Tata Power Share Price Target

Motilal Oswal maintained a 'Buy' rating of Tata Power stock with a target price of Rs 455 per share in the long-term. "The valuation of TPWR is segmented across various business units, leading to a TP of INR455. The regulated business is valued using a 2.5x multiple on the regulated equity. The coal segment is valued at 1x book value. The renewables segment is valued at 12x FY28E EBITDA," noted the brokerage in its report.

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