Tata Power Co. Ltd.
ISIN: INE245A01021 • Market Cap: ₹1.21 Lakh Cr
The 5-Pillar Quality Audit for Tata Power Co. Ltd.
Evaluated across Profitability, Financial Health, Historical Compounding, Valuation Safety, and Ownership Governance:
1. Profitability & Capital Efficiency
Weight: 25%Measures operating margins (23.1%), Return on Capital Employed (7.4%), and equity compounding (9.5%).
2. Financial Health & Solvency
Weight: 25%Debt-to-Equity is 1.81 with comfortable interest coverage and clean working capital.
3. Growth & Compounding Track Record
Weight: 20%Historical 3Y Sales CAGR (1.1%) and 3Y PAT CAGR (6.3%).
4. Valuation Multiple & Margin of Safety
Weight: 15%Trades at P/E of 31.28 vs PEG of 1.84 and Dividend Yield of 0.7%.
5. Ownership Quality & Governance
Weight: 15%Promoter holding stands at 46.9%, backed by 28.5% institutional ownership.
Key Fundamental Strengths
Deep Institutional Sponsorship (28.5%)
Mutual funds, domestic DIIs, and foreign FIIs hold 28.5%, providing strong governance scrutiny.
Consistent Market Standing (Large Cap)
Established player in the Power sector with an overall fundamental quality score of 55/100.
Areas to Watch & Potential Risks
Subdued Capital Efficiency (ROCE: 7.4%)
A sub-12% ROCE suggests return on capital barely exceeds the company's weighted average cost of capital (WACC).
Elevated Financial Gearing (D/E: 1.81)
Debt-to-Equity exceeds 0.9x, meaning substantial operating earnings are absorbed by mandatory interest coverage.
Topline Stagnation (3Y Sales CAGR: 1.1%)
Revenue growth has slowed below inflation rates, indicating cyclical demand slowdown or saturated core markets.
Quantitative Strategy Eligibility
Checking TATAPOWER against established Indian wealth creation frameworks:
Coffee Can Investing Framework
Fails 10%+ revenue growth or 15%+ minimum capital return benchmark over historical periods.
Quality Factor Screener (High RoIC + Low Debt)
Scorecard of 55/100 or leverage profile sits below strict quality index hurdles.
GARP / Value-Growth Blend
Valuation multiple or return metrics require further cyclical pullback.
Power Sector Peer Comparison
Compare TATAPOWER directly against top industry peers by market capitalization:
| Company | 5-Pillar Score | Market Cap | P/E | ROCE | D/E | Scorecard |
|---|---|---|---|---|---|---|
| Tata Power Co. Ltd. (TATAPOWER)Current | 55/100 | ₹1.21 Lakh Cr | 31.28 | 7.4% | 1.81 | — |
| Adani Power Ltd. (ADANIPOWER) | 70/100 | ₹3.93 Lakh Cr | 27.56 | 15.7% | 0.82 | View |
| NTPC Ltd. (NTPC) | 69/100 | ₹3.25 Lakh Cr | 11.69 | 8.3% | 1.32 | View |
| Power Grid Corporation of India Ltd. (POWERGRID) | 64/100 | ₹2.44 Lakh Cr | 15.36 | 10.6% | 1.47 | View |
| Adani Green Energy Ltd. (ADANIGREEN) | 56/100 | ₹2.12 Lakh Cr | 119.11 | 8.3% | 5.24 | View |
| Adani Energy Solutions Ltd. (ADANIENSOL) | 66/100 | ₹1.88 Lakh Cr | 64.52 | 8.7% | 2.02 | View |
Frequently Asked Questions: Tata Power Co. Ltd.
Q:What is the 5-Pillar Fundamental Score for Tata Power Co. Ltd. (TATAPOWER)?
Tata Power Co. Ltd. has a RupeeTools Fundamental Score of 55/100, placing it in the 'Moderate / Average' category. Its pillar scores are: Profitability (55/100), Financial Health (49/100), Growth (48/100), Valuation (63/100), and Ownership Quality (70/100).
Q:Is TATAPOWER fundamentally strong for long-term investment?
TATAPOWER currently holds a moderate quality rating of 55/100. While it operates in the Power sector, investors should monitor its debt health before initiating long-term positions.
Q:Does TATAPOWER pass the Coffee Can Investing filter?
No. TATAPOWER does not currently meet the strict 15% ROCE and 10% sustained topline compounding threshold mandated by the Coffee Can investing framework.
Q:How does TATAPOWER compare against other Power peers?
Within India's Power sector, TATAPOWER trades at a P/E of 31.28 and generates an ROCE of 7.4%. Compare its 5-Pillar score of 55/100 against top sector peers like Adani Power Ltd. (70/100), NTPC Ltd. (69/100).
Regulatory & SEBI Research Analyst Compliance Disclaimer:
This 5-pillar fundamental score is an automated quantitative health check generated purely from historical public financial statements, corporate filings, and exchange disclosures for educational and informational purposes only. It does NOT constitute investment advice, a stock recommendation, or a solicitation to buy or sell securities. RupeeTools is not a SEBI-registered Research Analyst. Please consult a SEBI-registered financial advisor before making investment decisions.