Thread by @Curious_Indian_

#TataPower Target ₹1000 in 5 Years ?

5X Multibbager in 5 Years

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In recent Tata Group Analyst Meet Company has set Target of
⚡️Revenue Target : 3X
⚡️PAT Target : 3X

In coming 5 Years (FY27)

Which means if a company is able to achieve above targets then it’s EPS will grow by 3X and resulting Stock price should definitely grow by 4-5X from CMP

So ultimately we can say Tata Power could hit 1000 in Next 5 Years

But few analyst don’t have the same view and they expect a very limited upside in Tata Power Stock

Let’s deep dive into Tata Power and understand if it can become 5X multibagger or not

If you want to go through the Analyst Meet presentation then check below link

bseindia.com/xml-data/corpf…

Tata Power Claims to be “India’s most comprehensive Green Energy Platform”

Basically company is working 6 Business verticals let’s understand them now

Pure Solar & Wind Energy Business:

2022 (Current) : 5.5 GW Development Portfolio
2027 (Target) : 20+ GW Development Portfolio – hybrid, RTC, Peak

EPC Business :
2022 : ₹ 6,000 crore p.a. revenue from Utility EPC Business
2027 : ₹ 20,000 crore annual revenue from Utility EPC business

In this Business company generates end to end electricity generation, transmission & Distribution network for other third party companies

Solar Cell Module Manufacturing :

2022 : 500 MW Cell & 635 MW Module manufacturing
2027 : 4.6 GW+ cell & module capacity

Rooftop Solar :

2022 : 385 MW p.a. Rooftop Solar at ₹ 1,500 crore annual revenue
2027 : 2.4+ GW p.a. at ₹ 10,000+ crore annual revenue

Expecting 6-8X Growth in this Business

Solar Pumps :

2022 : 27,500 solar pumps sold in FY 22 at ₹ 700 crore revenue
2027 : 2.5+ lac pumps at ₹ 5,000+ crore annual revenue; develop markets beyond PM-KUSUM

EV Charging : Currently leader in this space

2022 : 2,600 EV charging points installed in 473 cities & towns (over & above home chargers)
2027 : 25,000+ EV charging points across India

No Revenue updates about this yet cont...

but this will be the game changer for Tata Motors in Future
Also it can generate good revenue in future when EV will become mainstream

Current Green Energy Capacity and Future Outlook for 2030 :

2022 : 102 GW installed
62GW : Solar
40 GW : Wind

2030 Target : 420 GW
60GW in Pipeline under development
260 GW by 2030 (30GW per annum planned)

This is main source of Revenue for Tata Power which is expected to grow 4-5X by 2030

There are many more companies which are focused on Green Energy Generation but Tata Power is one of the leading and most organized player of the industry with profitable business

Solar Rooftop Business Growth Expectations

As it will reduce electricity bills for end users so this is supposed to grow rapidly

Tata Power has few advantages in this segment :
Trust
Strong Distribution Network
Brand Value

EV Business :
in Below Image you can see current installed EV chargers and key partners in this business

Looking at list one can easily say Tata Power may continue to hold Leader position in this business

Most Important : Debt

Company is also planning on Debt Reduction

Company is Planning for :
3X Revenue Growth
4X PAT Growth
ROCE : 11% & ROE : 13%
Debt to Equity < 3.5
Debt to EBITDA < 1.5

But as per few analyst stock is expensive and won't be able to achieve these targets

Kotak : Topline growth be there but bottomline growth is doubtful

CLSA : Current PAT Growth driver is Thermal energy and conversion from Thermal to RE is doubtful

Our Conclusion : (Invested & Biased)

As this presentation looks mouth watering but we need to first understand that it is meant for investors to it is supposed to be that way only so need to add some loads of salt to this and then take our decision though we firmly trust Tata

So our conclusion is Company can definitely achieve these milestones but we need to track it's growth and promises every quarter and year to check if it is able to deliver it's promises or not.

I'm invested so my view could be biased so let me know your view in comment below

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