Tata Power share price target: 29% upside? Why MOFSL is bullish on this Tata stock post AGM
Tata Power has identified land across three states for the proposed nuclear project, which is estimated to require capex of about Rs 18-20 crore per MW and operate at a plant load factor of more than 90 per cent.
- Jul 15, 2026,
- Updated Jul 15, 2026 9:04 AM IST
MOFSL, in its latest note on Tata Power Company Ltd, said the company's management highlighted a new long-term growth avenue at the recently concluded AGM through a planned entry into the nuclear power sector in collaboration with Nuclear Power Corporation of India Limited. The initiative is set to begin with an initial 440 MW Bharat Small Reactor project comprising two 220 MW unit.
MOFSL reiterated its 'Buy' rating on the Tata group stock with a target price of Rs 488, implying 29 per cent upside. The domestic brokerage said multiple catalysts remain in place for FY27, even as the stock has fallen 11 per cent in the past three months.
According to MOFSL, Tata Power has identified land across three states for the proposed nuclear project, which is estimated to require capex of about Rs 18-20 crore per MW and operate at a plant load factor of more than 90 per cent. Preparatory work is under way, although commissioning is not expected before the early 2030s.
The brokerage said the plan could become a meaningful long-term opportunity for Tata Power against India's target of 22GW of nuclear capacity by FY32. At the AGM, management also shared its aspiration to nearly double revenue to Rs 1 lakh crore and raise net profit to Rs 10,000 crore by 2030.
MOFSL noted that the Parliament passed the SHANTI Bill in December 2025, which is expected to enable a calibrated opening of the sector for private participation in support of the national target of 100GW of nuclear power capacity by 2047. Tata Power is currently targeting the development of the first 440MW project using indigenous Bharat Small Reactor technology in partnership with NPCIL, and discussions are under way to finalise the project structure and implementation framework.
MOFSL said project development work is progressing, with Tata Power identifying land in three states, securing water allocations, carrying out site-specific geotechnical studies and preparing the Detailed Project Report. According to its channel checks, the company has also hired senior NPCIL personnel to strengthen execution capabilities, while discussions with the government on long-term nuclear fuel supply are continuing.
The brokerage said the tariff framework is yet to be finalised. It also pointed to AI-led data centres and other power-intensive industries as an important demand driver for nuclear power because of their need for reliable, round-the-clock, low-carbon electricity, making nuclear a complement to renewable energy.
For FY27, MOFSL said it is modelling about 34 per cent year-on-year (YoY) growth in profit after tax for Tata Power, led mainly by a sharp reduction in Mundra losses.
It said this should be supported by the extension of Section 11 until September 2026 and the transition to the SPPA framework after that. The brokerage also said Tata Power's 30 per cent stake in the Indonesian coal business offers further upside, with every $10 per tonne increase in coal realisations translating into about Rs 400 crore of incremental profit after tax, or roughly 10 per cent of FY26 profit after tax.
MOFSL said profitability at TP Solar remains strong, supported by more than 90% utilisation of the cell line and continued third-party cell sales. It said cell manufacturing margins remain robust, adding that it is modelling a 29% EBITDA margin for Premier Energies in the first quarter of FY27. It also noted that internal consumption of DCR-compliant cells is currently low because most of Tata Power's ongoing projects do not require DCR modules, allowing surplus cell production to be monetised through third-party sales. In addition, management has guided for the commissioning of about 2.0-2.5GW of the company's own renewable energy capacity in FY27 as third-party EPC execution declines materially.
MOFSL further said growth will be supported by transmission capex in Mumbai and continued distribution efficiency gains in Odisha. It said annual transmission capex in Mumbai is set to double to about Rs 3000 crore from about Rs 1,500 crore as part of the company's roughly Rs 15,000 crore billion investment plan through FY31, with a fixed regulated return of 15.5 per cent contributing directly to profit after tax.
In Odisha, the brokerage said the business continues to post operational improvements, with billing efficiency at 85-90 per cent, AT&C losses falling to about 15.5 per cent in FY26, down about 200 basis points year on year, and return on equity improving to about 21 per cent.
Management expects AT&C losses to decline by a further about 2 per cent each year, with all Odisha distribution circles targeted to reach losses of 12-13 per cent over the next four to five years.
MOFSL, in its latest note on Tata Power Company Ltd, said the company's management highlighted a new long-term growth avenue at the recently concluded AGM through a planned entry into the nuclear power sector in collaboration with Nuclear Power Corporation of India Limited. The initiative is set to begin with an initial 440 MW Bharat Small Reactor project comprising two 220 MW unit.
MOFSL reiterated its 'Buy' rating on the Tata group stock with a target price of Rs 488, implying 29 per cent upside. The domestic brokerage said multiple catalysts remain in place for FY27, even as the stock has fallen 11 per cent in the past three months.
According to MOFSL, Tata Power has identified land across three states for the proposed nuclear project, which is estimated to require capex of about Rs 18-20 crore per MW and operate at a plant load factor of more than 90 per cent. Preparatory work is under way, although commissioning is not expected before the early 2030s.
The brokerage said the plan could become a meaningful long-term opportunity for Tata Power against India's target of 22GW of nuclear capacity by FY32. At the AGM, management also shared its aspiration to nearly double revenue to Rs 1 lakh crore and raise net profit to Rs 10,000 crore by 2030.
MOFSL noted that the Parliament passed the SHANTI Bill in December 2025, which is expected to enable a calibrated opening of the sector for private participation in support of the national target of 100GW of nuclear power capacity by 2047. Tata Power is currently targeting the development of the first 440MW project using indigenous Bharat Small Reactor technology in partnership with NPCIL, and discussions are under way to finalise the project structure and implementation framework.
MOFSL said project development work is progressing, with Tata Power identifying land in three states, securing water allocations, carrying out site-specific geotechnical studies and preparing the Detailed Project Report. According to its channel checks, the company has also hired senior NPCIL personnel to strengthen execution capabilities, while discussions with the government on long-term nuclear fuel supply are continuing.
The brokerage said the tariff framework is yet to be finalised. It also pointed to AI-led data centres and other power-intensive industries as an important demand driver for nuclear power because of their need for reliable, round-the-clock, low-carbon electricity, making nuclear a complement to renewable energy.
For FY27, MOFSL said it is modelling about 34 per cent year-on-year (YoY) growth in profit after tax for Tata Power, led mainly by a sharp reduction in Mundra losses.
It said this should be supported by the extension of Section 11 until September 2026 and the transition to the SPPA framework after that. The brokerage also said Tata Power's 30 per cent stake in the Indonesian coal business offers further upside, with every $10 per tonne increase in coal realisations translating into about Rs 400 crore of incremental profit after tax, or roughly 10 per cent of FY26 profit after tax.
MOFSL said profitability at TP Solar remains strong, supported by more than 90% utilisation of the cell line and continued third-party cell sales. It said cell manufacturing margins remain robust, adding that it is modelling a 29% EBITDA margin for Premier Energies in the first quarter of FY27. It also noted that internal consumption of DCR-compliant cells is currently low because most of Tata Power's ongoing projects do not require DCR modules, allowing surplus cell production to be monetised through third-party sales. In addition, management has guided for the commissioning of about 2.0-2.5GW of the company's own renewable energy capacity in FY27 as third-party EPC execution declines materially.
MOFSL further said growth will be supported by transmission capex in Mumbai and continued distribution efficiency gains in Odisha. It said annual transmission capex in Mumbai is set to double to about Rs 3000 crore from about Rs 1,500 crore as part of the company's roughly Rs 15,000 crore billion investment plan through FY31, with a fixed regulated return of 15.5 per cent contributing directly to profit after tax.
In Odisha, the brokerage said the business continues to post operational improvements, with billing efficiency at 85-90 per cent, AT&C losses falling to about 15.5 per cent in FY26, down about 200 basis points year on year, and return on equity improving to about 21 per cent.
Management expects AT&C losses to decline by a further about 2 per cent each year, with all Odisha distribution circles targeted to reach losses of 12-13 per cent over the next four to five years.