📊TATA POWER COMPANY LIMITED (#TATAPOWER)
💥CMP: 231 Rs, Market Cap: 74,148 Cr
💥EV Charging Solutions + Renewable Energy
💥Business Analysis. A Thread 🧵
🌁BUSINESS
Established in 1915.
India’s largest integrated power company has a presence across the power value chain.
Involved in the business of generation (Thermal, Hydro, Solar and Wind), transmission and distribution of electricity.
One of the largest renewable energy players in India and has developed country’s first 4000 MW Ultra Mega Power Project at Mundra (Gujarat) based on Supercritical technology.
In February 2017, Tata power has become the first Indian company to ship over 1 GW Solar Modules.
🌁MANAGEMENT
Dr. Praveer Sinha (MD & CEO) : Total 37 Years of Experience.
Joined in Tata power on 5 September 2007.
CEO from 1 May 2018 (4.2 Years).
CEO and leadership team salary has been consistent with company performance.
Average Tenure of Leadership Team is ~13 Years.
🌁SHAREHOLDING PATTERN
Promoters increased the shareholding from 36.21% in Sep 2019 to 46.86% in June 2022
On the other side DII and FIIs are reduced the stake.
🌁INSTALLED CAPACITY
Renewable Energy: 3,400 MW
Conventional Energy : 10,115 MW
Renewable energy is currently contributing 34% and is expected to increase by 80% in 2030 and 100% by 2040-50.
🌁CLEAN & GREEN ENERGY
Tata power is steering the transformation of traditional utilities to providers of integrated solutions by initiating new business models in
EV Charging Solutions
Solar Pumps
Rooftops
Micro Grids
Home Automation
Smart Meters
🌁DISTRIBUTION NETWORK
Total Sates and UTs Served : 19
Total Customers Served : 12.3 Million
🌁EV CHARGING SOLUTIONS
E-Bus charging points: 242
Home Chargers installed: 18,513
public EV Chargers installed: 2,373
🌁INTERNATIONAL PRESENCE
It has operations in India, Georgia, Singapore, Indonesia, South Africa, Bhutan, Zambia and Mauritius
As on 31 March 2022, Tata power had
59 Subsidiaries (44 are Wholly Owned)
32 Joint Ventures (JVs)
5 Associates
🌁REVENUE BREAKUP (Product wise)
Transmission & Distribution: 65%
Generation: 17%
Renewables: 17%
Others: 1%
🌁FINANCIALS (5 Year CAGR)
Sales Growth : 9.2%
EBITDA Growth : 5.3%
PAT Growth : 9%
ROCE: 9.3%
ROE: 8.42%
Net Cash Flow as on March 2022 : - 741 Cr
Overall financials are very poor but improving
🌁DEBT
Debt is reducing continuously from 2017, good sign.
Still debt is on the higher side and company is paying lot of interest.
🌁VALUATION
Price to Earning (PE) : 34.6 (Above it’s 5 Yr median PE 18.8)
Price to book value : 3.30
PEG Ratio : 3.94
EV to EBITDA : 17.62
By considering the future of EV and Renewables energy, stock price rallied heavily and is trading at premium valuation.
🌁QUARTERLY RESULTS (Q1 FY23)
Net Sales: 14,495.48 Cr (45% Up YoY, 21% Up QoQ)
Consolidated Net Profit: 794 Cr (103% Up YoY, 57% Up QoQ)
Operating Profit declined in QoQ and YoY
🌁STRENGTHS
Power portfolio, international presence, strong distribution network
Improving scale of new business, Capex to support growth
Contribution from renewable business improving
Collaboration with OEMs to roll out EV infrastructure
Improving financials
🌁WEAKNESS
Poor sales growth
Low ROE and ROCE
Debt reduced but still on the higher side
High interest payment
Good competition in Renewable sector
Premium Valuation
🌁CHART (Weekly Timeframe)
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