Tata Power is charged up!

Tata Power is amongst the top gainers of the day currently; the stock opened higher at Rs.83 from Friday’s close of Rs.78.70. The stock remains in the green, up over 4.5%.

The stock is up today on news that the Central Electricity Regulatory Commission (CERC) has allowed higher tariffs and compensation of Rs.329 crore for Tata Power’s 4000-MW Mundra project. The regulator has also stated that Tata can raise the tariff by Rs 0.524 per kWh for the project from the period beyond April 1, 2013. This is lower than what Tata Power expected but it will surely help the company recoup the losses it is currently making - we could first expect a breakeven and then eventually this tariff hike and compensation will allow it to return to the green. It is good news for Tata Power but it means that people living in Gujarat, Maharashtra, Rajasthan, Haryana and Punjab will now have to shell out more.