Tata Power Bags 200 MW Energy Project with NTPC; IIFL Calls It Top Stock Pick Despite 21% 6 Months Dip

Tata Power Renewable Energy Limited, a subsidiary of Tata Power Company Limited, has signed a Power Purchase Agreement with NTPC Limited to develop a 200 MW firm and dispatchable renewable energy project. This mega collaboration will suppposedly boost stock market performance of both the stocks. Since the market is closed today on the account of Ambedkar Jayanti, both Tata Power and NTPC shares will be on traders' radar tomorrow.

Tata Power PPA with NTPC Details

The newly signed PPA is for a 200 MW Firm and Dispatchable Renewable Energy (FDRE) Project. As per company officials filing at the exchanges, this is not just an ordinary solar or wind setup; it's a hybrid project that will use solar, wind, and Battery Energy Storage Systems (BESS). This mix allows the system to supply clean electricity even when the sun isn't shining or the wind isn't blowing.

The project will be spread across multiple locations in India and is expected to be completed within 24 months. Once fully operational, it will generate approximately 1,300 million units (MUs) of clean energy every year. That's enough to power thousands of homes while reducing over 1 million tonnes of carbon emissions annually.

One of the main features of this project is its ability to deliver power during peak hours, which is when electricity demand is at its highest. The project guarantees at least 90% availability for a 4-hour peak power window, which is great news for electricity distribution companies (Discoms) struggling to meet rising demand.

Tata Power's Growing Renewable Energy Portfolio

With this new project, Tata Power Renewable Energy Limited (TPREL) has reached a total renewable energy capacity of 10.9 GW. As per official data, here's how it breaks down:

5.5 GW is already operational, which includes 4.5 GW of solar power and 1 GW of wind power. While the other 5.4 GW is under construction, which is divided into 2.7 GW of solar projects and 2.7 GW of wind projects. These under-development projects will be completed in stages over the next 6 to 24 months.

Tata Power Share Price Movement

Shares of Tata Power Ltd ended in the green on the last trading session on Friday, April 11th. At the end of the trade, Tata Power shares rose 1.86% to close at Rs. 364.90. In the previous week Tata Power stocks lost about 5.3% of their value. And the stocks are down 21% in the last six months.

In its latest research report , IIFL Capital issued a BUY call for Tata power stating, "We anticipate energy transition to quadruple the profit pool for renewable developers. Tata Power is our top pick with a target price of Rs. 435/share."

According to IIFL, integrated renewable developers with capabilities in backward and forward integration, including battery storage, green hydrogen, and smart energy infrastructure, are best positioned to capitalize on India's evolving energy ecosystem. Tata Power Renewable Energy, with its large balance sheet and expertise in hybrid energy projects, is well-poised to lead this transformation.

NTPC Shares Price Movement

Shares of NTPC have also been very active on the stock exchange last week. At the end of Friday's trading session, NTPC shares closed in the green at Rs. 359.70, up by 2.96%. In the last six months NTPC shares have dropped by 15.27%.

About Tata Power

Tata Power Company Limited, founded in 1911, is India's oldest and one of the largest integrated power companies, with operations spanning the entire power value chain, including generation, transmission, distribution, and trading. A major part of the Tata Group, Tata Power has played a pioneering role in India's energy sector for over a century. Headquartered in Mumbai, Maharashtra, the company serves over 12 million distribution customers and continues to expand its footprint in renewable energy, electric vehicle infrastructure, solar rooftop solutions, and smart energy services as per the company profile.

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