Tata Power shares: Should you book profit or hold the multibagger stock?

Shares of Tata Power are in a consolidation mode, with analysts of the view that the Tata Group's multibagger stock could see a breakout on the upper side. Tata Power shares have delivered positive returns across all time durations except in a year when they fell 6.5%. The stock zoomed 776% in five years and gained 437% in ten years.

The stock trades above all-short term and long term-moving averages signalling the trend is bullish on the power sector stock. 
 
In the current session, Tata Power shares were trading on a flat note at Rs 407 on BSE. Market cap of the firm rose to Rs 1.30 lakh crore. The stock is neither oversold nor overbought on charts, signals its relative strength index (RSI), which stands at 54.8. In terms of price action, the stock is trading higher than the 5 day, 10 day, 20 day, 30 day, 50 day, 100 day, 150 day, 200 day moving averages.

The Tata Group stock touched a record high of Rs 494.85 on September 27, 2024. It has seen very high volatility in the last one year as its beta stands at 1.38.

Shiju Koothupalakkal, Senior Manager - Technical Research Analyst at PL-CAPITAL said, "The stock has been moving sideways for quite some time with support maintained near Rs 390 zone positioned near the base of the ascending channel with currently having the important 200 period MA and 50EMA at around 396 level as the near-term support and on the upside, it would need a decisive breach above the Rs 415 zone to establish conviction and improve the bias, expecting for further rise having higher targets of Rs 438 and Rs 455 levels in the coming days. With overall bias maintained positive, expect for further rise keeping stop loss of 390 and expect for targets of Rs 415 – Rs 438 – Rs 455 levels."

AR Ramachandran, SEBI registered Independent analyst says, "Tata Power stock price is slightly bullish on the Daily charts with strong support at 396.6. A Daily close above resistance of 410 could  lead to a target of 430 in the near term.

Drumil Vithlani, Technical Research Analyst at Bonanza Portfolio advises investors to adopt a wait-and-watch approach.

"Tata Power has been trading within a well-defined rising channel pattern since February 2025. Currently, the stock is hovering near its 20- and 50-day EMAs, indicating a crucial support zone. However, the ADX is trending lower, signaling weakening trend strength and a lack of momentum in the ongoing up move. Traders holding existing long positions should remain cautious and maintain a strict stop-loss below Rs 395, which aligns with the 50 EMA. On the upside, fresh buying should be considered only on a breakout above Rs 410, which could potentially open the path for an upward move towards Rs 440. Until then, a wait-and-watch approach is advisable," Vithlani said.

Om Mehra, Technical Research Analyst, SAMCO Securities said, "Tata Power continues to trade within a well-structured uptrend, supported by a rising trendline that has consistently held since late April. After testing the Rs 385–Rs 390 support band last month, the stock rebounded and is now consolidating near the upper end of its recent range, just above Rs 400.

The stock remains aligned with the middle Bollinger Band, while the rising lower band offers cushion on dips. The short-term consolidation over the past week appears healthy, with a series of narrow-bodied candles indicating indecision without deterioration. The support zone near Rs 395– Rs 390 remains crucial, aligning with the trendline, previous breakout level, and the lower edge of the recent rectangle formation. As long as the stock holds above Rs 388, which aligns with 78.6% of Fibonacci retrenchment, the broader trend remains positive. A decisive move above Rs 407 could open upside potential toward the Rs 418– Rs 425 zone. Until then, the current phase offers a short-term accumulation zone for those anticipating the continuation of the prevailing trend."