In the course of its strong uptrend, Tata Power shares consolidated in a band of ₹260 – 200 for many months. Recently, it broke out from that range and almost tested ₹300 mark. However, it is again at the breakout zone, highlighted domestic brokerage and research house Anand Rathi.
The brokerage has a Buy rating on Tata Power shares with implying a potential upside of 38% from the current stock level. “The target for range breakout comes around ₹320 but we are also witnessing a flag breakout on the larger time frame. Thus, we advise traders to go long in the stock in the range of ₹252 – 242 with a stop loss of ₹200 for the upside target of ₹340 in 3 – 6 months," recommended Anand Rathi.
Tata Power is India's largest integrated power company with a growing international presence. The core business of the company is to generate, transmit and distribute electricity. It is also one of the largest renewable energy players in India with a clean energy portfolio of 30%.
The company recently has announced consolidation of all green businesses (RE) under its subsidiary Tata Power Renewable Energy (TPREL), and binding agreement with a BlackRock-led consortium, concluding the long-awaited divestment of stake in its renewables businesses.
The first round of capital infusion is expected to be completed by June 2022 and the balance funds will be infused by the end of the ongoing calendar year, the Tata Group company had said in a statement.
The newly created structure will house all renewable energy businesses of Tata Power including utility-scale solar and wind generation assets, solar cell and module manufacturing, engineering, procurement and construction, rooftop solar, solar pumps, energy storage and electric vehicle charging infrastructure.
The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.
