Tata Power to Boost FY25 Capex 66%, Spend 50% on Renewables Energy
Tata Power has set its sights on a significant 66% increase in capital expenditure, planning to invest Rs 20,000 crore in the current fiscal year compared to Rs 12,000 crore in the previous year. This focus aligns with India's net-zero emission target by 2070 and aims to support energy transition projects. The company's CEO, Praveer Sinha, disclosed the investment strategy during a post-earnings conference call.
The planned investment will be allocated primarily to renewables, making up 50% of the budget, while the remaining funds will support a mix of transmission, distribution, and conventional projects. The expenditure will be funded through internal accruals and some debt.
Tata Power's recent financial results show a consolidated net profit increase of 11% to Rs 1,046 crore in the March 2024 quarter compared to Rs 939 crore in the same period the previous year. This growth is attributed to higher revenues.
The company’s renewable energy segment is progressing rapidly, with its 4.3 GW Cell & Module manufacturing facility in Tirunelveli, Tamil Nadu, already commencing production and commercially producing around 130 MW of modules.
Additionally, during FY24, Tata Power secured two projects worth Rs 2,300 crore under the Tariff-Based Competitive Bidding (TBCB) process. These projects include the Interstate Transmission System (ISTS) - Bikaner III Neemrana II Transmission Ltd and the Intrastate Transmission Scheme in Uttar Pradesh through the SPV Jalpura Khurja Power Transmission Ltd.
Tata Power is pursuing an accelerated growth trajectory towards green energy, aiming to derive approximately 70% of its capacity from non-fossil-based fuels by 2030. As of March 31, 2024, the company has 4.5 GW of renewable capacity operational and an additional 5.5 GW of projects under implementation, bringing its total green energy portfolio to over 10 GW.
Moreover, Tata Power boasts a robust transmission line portfolio, with 6,277 circuit kilometers (Ckm) operational, including 1,651 Ckm of capacity in the pipeline. These initiatives highlight the company's commitment to advancing India's energy transition and achieving net-zero emissions.
