This Tata Group inventory zoomed 13% at the moment; this is why


Tata Power’s stake rose 13 percent, hitting a 52-week high of Rs 132.50 one day after the Indian Competition Commission (CCI) approved the acquisition of 51 percent of each of Tata Power’s stakes in three Odisha utilities of BSE.

The company will acquire shares in Western Electricity Supply Company of Odisha (WESCO), Southern Electricity Supply Company of Odisha Ltd (SOUTHCO) and Central Electricity Supply Company of Odisha Ltd (CESCO).

The deal comes under separate tender processes initiated by the Odisha Electricity Regulatory Commission. The Chamber of Commerce approved the proposed combinations, according to a notice published on Tuesday.

The stock ended 6.54 percent higher at Rs 124.65 from its previous closing price of Rs 117.00 on the BSE. The company’s market capitalization rose to Rs 39,829.91 billion.

Tata Power stock trades higher than the 5-day, 20-day, 50-day, 100-day, and 200-day moving averages. The share gained 190.5 percent in one year and has risen 65 percent since the beginning of the year.

Lately, power stocks have played a role. The BSE Power Index hit a high of Rs 3,083.79 in intraday trading on Wednesday. Power Grid and NTPC each gained over 2-3 percent in BSE.

Electricity consumption in the country rose 12.6 percent to 25.36 billion units (BU) in the first week of June, suggesting a slow recovery in commercial and industrial electricity demand, according to government data.

Experts hope commercial and industrial electricity consumption and demand will rise again from June as many states relax local restrictions imposed to contain the second wave of coronavirus.

Tata Power posted net income of Rs 392.94 billion for the quarter ended March 2021, compared to Rs 402.59 billion in the previous quarter that ended March 2020.

Net sales increased 52.96 percent to Rs 10,127.39 billion for the quarter ended March 2021, compared to Rs 6,620.80 billion in the previous quarter ended March 2020.

For the full year, net income rose 10.81 percent to Rs 1,127.38 billion in March 2021, compared to Rs 1,017.38 billion in March 2020.

The company recently also received a Letter of Award (LoA) to build 210 MWp solar PV projects for NTPC. The total value of the projects is approximately Rs 686 crore. The commissioning date for NTPC is set to November 2022.

With this addition, Tata Power Solar’s order pipeline is approximately 2.8 GW valued at approximately Rs 13,000 billion, cementing its position as India’s leading solar EPC player.

The scope of work includes land, transmission, engineering, procurement, installation and commissioning of the solar projects. The NTPC project is located in Gujarat.