Tata Power Q3 Results Preview: PAT seen slipping, focus on Mundra and renewables

Tata Power Q3 Results Preview: Tata Power Company Ltd is set to report its consolidated results for the December quarter today. The Tata Group firm had earlier informed exchanges about the earnings schedule.

Ahead of the results, Tata Power shares were trading at Rs 368.85 on Wednesday, up Rs 3.75, or 1.03 per cent.

Tata Power Q3 Results Preview

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As per Zee Business estimates, Tata Power’s December quarter performance is expected to be mixed, with pressure on profitability despite steady revenue growth.

Consolidated revenue is seen at Rs 16,453 crore, up 6.9 per cent year-on-year, compared with Rs 15,391 crore in the same quarter last year. EBITDA is likely to decline 2.1 per cent to Rs 3,283 crore from Rs 3,353 crore. EBITDA margin is estimated at 20 per cent versus 21.8 per cent a year ago.

Net profit is expected at Rs 918 crore, lower by 22.7 per cent from Rs 404 crore reported in the year-ago quarter, according to estimates.

Why earnings may remain under pressure

The key drag on performance is expected to be the Mundra thermal power plant. Losses at Mundra have widened due to the non-implementation of Section 11 relief and unit shutdowns during the quarter. This has weighed on plant-level profitability and put pressure on consolidated EBITDA.

Management commentary on any progress related to Mundra, including cost recovery or regulatory relief, will be closely watched.

What is supporting the business

Despite weakness at Mundra, several segments are expected to provide support. The solar cell and module business is likely to see the benefit of full ramp-up during the quarter. Commissioning of new renewable energy assets is also expected to aid top-line growth.

The solar rooftop business continues to show strong traction, supported by rising demand from commercial and industrial customers. In addition, the Odisha discom operations are expected to remain stable. The distribution business has been delivering consistent performance and continues to support consolidated earnings.

Key triggers to watch going forward

Investors will focus on three major triggers. The first is the pace of renewable capacity commissioning and the company’s execution pipeline. The second is any clarity or resolution on a supplementary power purchase agreement for the Mundra plant. The third is the consolidation and scale-up of EPC and solar module sales, which could improve margins over time.

Management guidance on these factors will be critical for the stock’s near- to medium-term outlook.

Q2 FY26 performance recap

In the September quarter, Tata Power reported consolidated revenue from operations of Rs 15,545 crore. This was down 0.9 per cent year-on-year and 13.8 per cent sequentially. Total income stood at Rs 16,050 crore.

Profit before tax rose marginally to Rs 1,680 crore from Rs 1,619 crore in the previous quarter. Net profit came in at Rs 1,245 crore, up 13.9 per cent year-on-year, supported by operational efficiencies and stable distribution earnings.

Total expenses for the quarter were Rs 14,724 crore, while total comprehensive income stood at Rs 1,656 crore.