As Tata Power Q4FY18 results loom, investors turn cautious; know what analysts say

On Wednesday, Tata Power share price became key stocks to watch on equity exchanges, as the company will be presenting their fourth quarter ended March 2017 results any time today. Looking at the trend of trading in these two companies, it can be said that investors are trading cautiously in the company ahead of the result announcement. Let’s have a look what analysts expect in last quarter of FY18 for these two. 

At around 1133 hours, share price of Tata Power was trading at Rs 87.70 per piece down by Rs 0.45 or 0.51%.

Swarnim Maheshwari analysts at Edelweiss Financial Services said, "Tata Power’s earnings are estimated to be healthy led by renewable and coal businesses."

Maheshwari adds, "We expect generation volumes to remain sluggish while realisations are expected to remain flattish. We expect coal business and renewable business to maintain strong momentum."

While Axis Capital said, "Rise in coal prices to improve realization of coal companies. Losses at Mundra UMPP to taper due to higher plant efficiency."

Explaining in detail, analysts at IDFC Capital said, "Mundra PAF for Q4FY18 was 91.4% and PLF was 89.8%. Overall, we expect PAT at Rs6bn, driven by better profitability at coal mines and reduced losses in Mundra. Coal prices were up by 31% yoy which should lead to increase in profit from coal SPV (net +ve impact of coal price movement). "

In IDFC views a list of key things will be monitorable this Q4FY18. They are - Progress on sale of Non Core Assets, Resolution on Mundra power plant and profit of renewables portfolio. 

It also needs to be noted, that post the supreme court order, Company is in discussion with lenders and procurers to sell the power plant to procurers. 

Tata Power clocked nearly three-fold jump on quarterly basis in its consolidated net profit during third quarter ended December 2017 (Q3FY18) financial performance. 

The company posted net profit of Rs 611.52 crore in this quarter, registering a growth of 161.15% from Rs 234.16 crore of the preceding quarter.