This multibagger Tata Group stock hits all time high today

Shares of Tata Power in Wednesday's trade (April 10) logged their all-time high of Rs 439.4 per share on the NSE. Shares of the company over the last one year have clocked a return of 123 per cent.

The gains in the stock are spurred amid a strong outlook for power demand going ahead. At 1:20 pm, shares of the company traded with gains of 1.06 per cent at Rs 434.7. After the recent phenomenal spike, the stock now is up significantly from its 52-week low price of Rs 1973.

As per media reports, the customers of Tata Power in Mumbai will have to shell out a higher electricity bill beginning April 1 as power regulator MERC approved an average tariff hike of around 24 per cent as against 12 per cent claimed by the power distributor.

"The present tariff hike is necessitated as there was under-recovery due to a stay on tariff as determined in the MTR (mid-term review) Order for FY 2023-24," added the report.

The stock is trading at a decent valuation with a trailing twelve-month (TTM) price to earnings (P/E) of 38.6, well below the industry average. 

Furthermore, the stock has also found a place in the recently launched NSE index dedicated solely to the Tata Group of companies. In the index, the stock has a 6.15 per cent weightage.

In the previous December ended quarter, the Tata Group power major posted a total revenue of Rs 5395.5 crore as against Rs 7026.4 crore in the same quarter of the previous year. Operating profit at the company also took a hit and came in lower at Rs 896.8 crore versus Rs 910.8 crore in Q3FY23. 

Tata Power Company Limited generates and supplies electricity. It constructs and operates independent power plants, as well as specialises in transmission and distribution of electricity. 

The stock has a consensus recommendation of a 'hold' from analysts with a one year target pegged at Rs 330, signalling a downside of 24 per cent.

Technicals paint a powerful outlook for the stock. Avdhut Bagkar, Derivatives and Technical Analyst, Stoxbox said shares of Tata power reached a new all-time high on Tuesday, fuelling positivity for following sessions. Until the support of the 50-daily moving average (DMA) placed at 389 is protected on the closing bias, the trend remains quite optimistic.  The price action is indicating a move towards 470 -490 levels. The strength index, the Relative Strength Index (RSI) has yet to enter the overbought territory signalling more room for upside. The range of Rs 420 -400 continues to witness accumulation and acts as a bolstering mark for the medium-term perspective. The underlying bias remains positive as the weekly chart denotes a breakout at all-time high marks.