Tata Power’s 104th AGM Highlights Strong Financial Performance And Commitment To Clean Energy Solutions

Tata Power, one of India’s leading integrated power companies, held its 104th Annual General Meeting (AGM) virtually, showcasing its impressive financial performance, strategic plans, and unwavering commitment to clean energy solutions. Chairman Mr Natarajan Chandrasekaran delivered a speech to shareholders, emphasizing the company’s achievements during the Financial Year 2022-23 and outlining its future growth prospects.

The past year witnessed significant disruptions in the global power markets due to intense geopolitical and geo-economic changes, notably the Russia-Ukraine conflict impacting the supply of natural gas and coal. These disruptions further reinforced Tata Power’s focus on clean energy transition and long-term sustainability. The renewables sector received substantial investments, with approximately $500 billion out of the global $1.11 trillion low-carbon energy investments in 2022.

India experienced a rapid growth in power demand, driven by accelerated economic growth, increasing industrial and commercial activities, and shifting weather patterns such as heat waves. The peak power demand in the early months of FY23 reached record levels of 216 GW, reflecting a 9% growth in power demand for the fiscal year. Notably, India’s per capita power consumption remains the lowest in the world, highlighting the country’s potential for further development in the power sector.

Tata Power remains at the forefront of the clean energy transition in India. The company’s total installed generation capacity reached 416 GW by the end of FY23, with renewables playing a pivotal role in driving this growth. Tata Power aims to achieve 500 GW of non-fossil installed capacity by 2030, making India the only major economy utilizing renewables to meet its power demand growth rather than substituting thermal power.

In terms of company performance, Tata Power has increased its total installed power generation capacity to approximately 14.1 GW. With a strong focus on renewables, the company added around 500 MW, bringing its total operational renewable capacity to approximately 3.9 GW. Additionally, with under-construction projects totalling approximately 2.7 GW, Tata Power is steadily progressing toward having clean and green sources account for close to 50% of its total installed capacity.

The company’s Solar Rooftop business demonstrated significant growth, with an extensive channel network of 450 dealers across 275 districts. Solar rooftops, along with captive solar EPC projects, generated revenue of over INR 1,000 crore in the last quarter of FY23, doubling from the previous year. Tata Power’s presence in the EV charging market is also prominent, with over 550 cities/towns covered and more than 127,000 registered users. The company plans to expand its network further, targeting highways, fuel pumps, and high-traffic city locations through strategic partnerships and its cloud-based technology platform.

Tata Power’s Distribution business continues to serve over 12 million customers, solidifying its position as the largest private power distribution utility in the country. In Odisha, the company’s efforts resulted in a substantial reduction in AT&C losses across all four Discoms, achieving a PAT of approximately INR 253 crore. Tata Power plans to continue investing in Odisha to further reduce AT&C losses.

Financially, Tata Power’s consolidated revenue grew by 32%, reaching INR 56,033 crore compared to INR 42,576 crore in FY22. The company’s consolidated reported PAT witnessed a remarkable 77% increase, totalling INR 3,810 crore, reflecting improved performance across all business clusters. These achievements translated into an increase in Return on Equity from 9.5% in FY22 to 12.6% in FY23 and an increase in Return on Capital Employed from 7.8% to 9.3% during the same period. Tata Power’s Net Debt to Equity ratio stands at 1x, and the company’s credit rating has been upgraded to BB+ with a Stable Outlook by S&P Global ratings.

Looking ahead, Tata Power plans to invest around INR 12,000 crore, double the capex spent in FY23, to fuel its growth targets. These investments will support the upcoming 4 GW manufacturing plant, under-construction renewable projects, and transmission and distribution businesses in Odisha, Delhi, and Mumbai. Furthermore, Tata Power aims to become an ESG benchmark in the power sector, aligning with its Project Aalingana, which envisions net zero carbon emissions by 2045, 100% water neutrality by 2030, and no net impact on biodiversity before 2030. The company also aspires to achieve zero waste to landfill before 2030.

In recognition of the company’s success and performance, the Directors have recommended a dividend of 200%, equivalent to INR 2 per equity share of INR 1.

Chairman Mr Natarajan Chandrasekaran commended the management team and all Tata Power employees for their exceptional dedication and steady performance throughout the year. With a strong financial foundation, a strategic focus on clean energy solutions, and a commitment to sustainable growth, Tata Power is well-positioned to capitalize on the growth opportunities in the evolving power sector while contributing to India’s sustainable development goals.