Tata Power Shares Climb on New Transmission Project Win

Tata Power Shares Climb on New Transmission Project Win

Tata Power Shares Climb on New Transmission Project Win

Tata Power’s shares witnessed a significant rise, nearly reaching a 4% increase to ₹286 on the Bombay Stock Exchange (BSE) during Monday’s trading session. This increase came after the company announced securing the Bikaner-III Neemrana-II Transmission project, an initiative by PFC Consulting, a subsidiary of Power Finance Corporation.

Project Details and Impact

The project, estimated to cost ₹1,544 crore, is expected to be commissioned within 24 months from the transfer of the project SPV. Tata Power will be responsible for maintaining the transmission project for 35 years. The project, to be developed on a Build-Own-Operate-Transfer (BOOT) basis, aims to facilitate the evacuation of 7.7 GW of renewable energy from the Bikaner Complex in Rajasthan. It involves setting up a ~340 km transmission corridor, playing a key role in the Ministry of Power’s plan to integrate over 500 GW of renewable energy capacity into the national grid by 2030.

Stock Performance and Analysts’ View

Tata Power’s stock has shown impressive growth, gaining over 25% in the last year and over 290% in the past three years. It closed at ₹281.50 on December 4, compared to its previous close at ₹275.75 on December 1. However, Trendlyne data suggests an average target price of ₹248 for Tata Power, indicating a potential 12% decline from its current market value. The consensus among 18 analysts is to ‘Hold’ the stock.

Technical Indicators

From a technical analysis perspective, Tata Power’s 14-day Relative Strength Index (RSI) stands at 67.6, nearing the overbought threshold of 70. The Moving Average Convergence Divergence (MACD) is at 3.9, indicating a bullish trend as it surpasses both its center and signal lines.

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