Why are Tata Power shares down for 5 sessions?

Shares of Tata Power dropped nearly 2% in opening trade on Friday, in sync with broader market, continuing its losing streak for the fifth straight session. The largecap stock has fallen over 4% in the last four trading days amid broad-based correction in the equity market.

The weakness in Tata Power shares were seen despite its solar manufacturing subsidiary securing a new contract. TP Solar has received a ₹632 crore contract from the Solar Energy Corporation of India (SECI) for the supply of 292.5 megawatt peak (MWp) DCR (domestic content requirement) solar modules.

Tata Power shares opened 0.9% lower at ₹340.25 on the BSE, after ending 2.2% lower at ₹343.30 in the previous session. Extending opening losses, the counter power heavyweight declined as much as 1.9% to ₹336.65, while the market capitalisation slipped to ₹1.07 lakh crore. Meanwhile, the BSE Sensex and NSE Nifty were down over 1% each.

Tata Power share price has seen sharp correction in the last five months, with the power stock losing 34% of its market value from its 52-week high of ₹494.85 touched on September 27, 2024. Currently, the stock is down 29% from its 52-week high level, while it is up nearly 8% from its 52-week low of ₹326.25 hit on February 17, 2025. The counter has lost 6% in a year; 21% in six months; and 6% in the past one month.

In an exchange filing last evening, TP Solar, a wholly owned subsidiary of Tata Power Renewable Energy Limited (TPREL) and a subsidiary of Tata Power, said it bagged a contract from the SECI under the CPSU scheme tranche-III. The contract entails the delivery of high-quality DCR modules to the designated site in Ramagiri, Andhra Pradesh. The project is part of SECI’s larger 400 MWp tender, which underwent a competitive bid submission process followed by an e-Reverse Auction. The contract includes a total scope of 400 MWp DCR Modules, of which TP Solar has secured 292.5 MWp, the release noted.

“The CPSU Scheme is a crucial initiative to enhance domestic solar manufacturing and strengthen India's energy security. By awarding this contract to TP Solar, we are taking a significant step towards fostering self-reliance in the solar sector and ensuring that large-scale renewable projects are powered by high-quality, locally manufactured modules,” said Sivakumar V Vepakomma, Director (Power System), SECI.

The delivery timeline for the project is set from October 2025 to January 2026, spanning a duration of four months. 

Moody’s affirms Ba1 rating to Tata Power

Earlier this week, foreign brokerage firm Moody's affirmed Tata Power Company's (TPC) corporate family rating (CFR) of Ba1 and changed the outlook to ‘positive’ from ‘stable’. "The positive outlook is underpinned by TPC's strong financial performance and our expectation that the company is likely to maintain its stronger credit metrics with improved operating efficiencies in its regulated businesses and growing renewable generation portfolio," said Zi Zhu, a Moody's Ratings Analyst.

TPC's CFR of Ba1 incorporates the company's standalone credit quality of Ba2 and a one-notch uplift for shareholder support. The rating affirmation reflects TPC's predictable cash flow generated by its regulated businesses in Mumbai, Delhi, and Odisha. These regulated businesses provide a stable revenue stream, contributing to the company's overall financial stability, said Moody’s.

Additionally, TPC's credit quality is supported by its fixed-tariff long-term power purchase agreements for its renewable generation capacity. Furthermore, it is likely to receive support from its largest shareholder, Tata Sons Private Limited (Tata Sons) if needed, demonstrated by Tata Sons' ability to provide support and track record of providing timely support to its investee companies, the brokerage said in a note.

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