Buy Tata Power, target Rs 94: Edelweiss Securities
Tata Power Company is a midcap company, operating in power sector.
Edelweiss Securities has given a buy recommendation on Tata Power Company with a target price of Rs 94.
Shares of Tata Power Company traded at Rs 66.4 around 1:45 pm on 25 June, 2019. The brokerage has set a one-year horizon for the stock to hit the target price.
During FY19, sale of Tata Communications and Panatone realised Rs 2,100 crore, whereas funds from sale of defence business (Rs 2,200 crore) are yet to be realized, said the brokerage.
Higher coal prices and DMO obligations in Indonesia disturbed the natural hedge. The combined operations reported Rs 750 crore net loss in FY19.
Gross debt has remained at similar level for the past three years at about Rs 48,700 crore partly due to RE capacity addition (200MW in FY19).
As per the brokerage, Tata Power has been underperforming broader indices over the past two years due to sticky Mundra issue, apart from flat profit.
FY20 could be an eventful year for the company with respect to full or partial resolution of CGPL, realisation of proceeds from sale of defence business, acquisition of Prayagraj, change in DMO policy in Indonesia and stake sale in Tata Projects.
The company's debt remains key monitorable, said the brokerage.
Shares of Tata Power Company traded at Rs 66.4 around 1:45 pm on 25 June, 2019. The brokerage has set a one-year horizon for the stock to hit the target price.
During FY19, sale of Tata Communications and Panatone realised Rs 2,100 crore, whereas funds from sale of defence business (Rs 2,200 crore) are yet to be realized, said the brokerage.
Higher coal prices and DMO obligations in Indonesia disturbed the natural hedge. The combined operations reported Rs 750 crore net loss in FY19.
Gross debt has remained at similar level for the past three years at about Rs 48,700 crore partly due to RE capacity addition (200MW in FY19).
As per the brokerage, Tata Power has been underperforming broader indices over the past two years due to sticky Mundra issue, apart from flat profit.
FY20 could be an eventful year for the company with respect to full or partial resolution of CGPL, realisation of proceeds from sale of defence business, acquisition of Prayagraj, change in DMO policy in Indonesia and stake sale in Tata Projects.
The company's debt remains key monitorable, said the brokerage.
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