Tata Power goes 'off'

Lights seem to have dimmed at Tata Power counter. The stock is down over 2.25% at Rs.86.75 with an intra day low at Rs.85.50.

The stock has dipped today, reacting to the company’s performance for Q2FY15 wherein it announced a consolidated loss of Rs.78 crore due to lower topline. The company had a profit of Rs.75 crore in previous Q2. Its revenue fell over 4% at Rs.8394 crore. The company has stated that the poor performance was on account of lower realization by coal companies and lower fuel cost in Mumbai operations.

In terms of segment-wise performance, revenues from power fell 3% due to lower fuel cost due to lower generation and lower volume traded by Tata Power Trading Company Limited (TPTCL).  Segment result of power rose 12% due to lower depreciation charge in Coastal Gujarat Power Limited (CGPL).  Revenue from coal business fell 10% and while EBIT fell 26% due to lower price realisation from coal companies despite higher volumes sold. Despite falling global coal prices, losses in coal companies have been minimized by prudent cost control measures.