The company said net profit attributable to shareholders dropped 25.1% year-on-year to 7.72 billion rupees (about $85 million), down from 10.31 billion rupees in the same period last year. Revenue from operations also declined 9.4% to 139.48 billion rupees, News.Az reports, citing Reuters.
The biggest drag came from Tata Power’s thermal and hydroelectric segment, where revenue plunged nearly 59%. The decline was largely linked to the continued shutdown of the company’s Mundra plant in Gujarat, which has remained non-operational since June 2025. Analysts say the shutdown followed the Indian government’s decision not to extend subsidy and reimbursement support for imported coal-based power generation.
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While the thermal business struggled, other segments posted strong growth. Renewable energy revenue surged 78.3%, reflecting India’s broader shift toward cleaner power sources. Transmission operations also expanded, with revenue rising 8.8%, supported by infrastructure expansion and steady electricity distribution demand.
Industry conditions have also weighed on performance. India’s overall power demand slipped 0.4% in the third quarter, affected by unseasonal rainfall in October and lower-than-normal temperatures. The drop in demand contributed to a slowdown in coal-based electricity generation, which fell sharply in late 2025. Coal-fired output declined 5.8% in November alone, marking one of the steepest drops since pandemic-era disruptions in 2020.
Despite short-term pressure, analysts note that Tata Power’s long-term outlook remains tied to its transition toward renewables and grid infrastructure. The company has been investing heavily in solar, wind and energy transmission projects as India accelerates its clean energy targets and power demand is expected to grow over the next decade.
In peer comparisons, Tata Power trades at valuation levels similar to some domestic rivals, though analyst sentiment remains cautious. Market consensus currently leans toward a “Hold” rating, reflecting mixed near-term earnings visibility alongside stronger long-term growth potential in clean energy.
The latest results highlight the structural shift underway in India’s energy sector. Companies heavily exposed to coal-based power are facing policy and demand risks, while renewable-focused businesses are benefiting from government incentives, climate targets and rising private sector investment.
For Tata Power, the key question going forward will be how quickly it can scale renewable capacity and offset volatility in its legacy thermal operations, especially if coal subsidies remain limited and demand patterns continue to fluctuate due to weather and economic conditions.
