Tata Power is charting an aggressive expansion, targeting solar cell and module exports to the US and Europe by fiscal year 2027, leveraging recent trade agreements that reduce tariffs to 18%. Concurrently, the company is advancing its entry into nuclear energy, identifying land for potential projects, and preparing its 4,000 MW Mundra coal plant for recommencement. This multi-pronged approach aims to diversify revenue streams beyond its established domestic power generation, transmission, and distribution businesses, even as market sentiment remains cautiously bearish.
Global Solar Ambitions Fuelled by Trade Pacts
Tata Power is poised to significantly expand its international footprint in fiscal year 2027 by commencing exports of solar cells and modules to the United States and Europe. This strategic pivot is heavily influenced by the recent conclusion of a Free Trade Agreement with Europe and a reduction in US tariffs on Indian goods, effectively lowering the burden to approximately 18%. CEO Praveer Sinha indicated that the company has secured the necessary export certifications and stabilized its existing 4.3 GW solar cell and module manufacturing facility, preparing for increased output to serve both domestic utility-scale and rooftop projects, as well as international markets. Complementing this, Tata Power is investing an estimated ₹6,500 crore to ₹10,000 crore in a new 10 GW integrated solar wafer and ingot manufacturing plant, aiming to complete its production chain and enhance export competitiveness. This move positions Tata Power to compete more effectively against established domestic players like Waaree Energies (13.3 GW module capacity) and Adani Solar. The India-US trade deal, in particular, is viewed by industry leaders as a 'strategic turning point,' significantly improving the cost-competitiveness of Indian-made solar products for the US market, which historically accounted for over 97% of India's PV exports.
Diversified Energy Strategy: Nuclear, Hydro, and Thermal Revival
Beyond solar, Tata Power is aggressively diversifying its energy portfolio. Operations at its 4,000 MW Mundra ultra-mega power plant are slated to recommence in the coming months, addressing rising power demand, following an in-principle agreement on a supplementary PPA with the Gujarat government. The company is also making tangible progress toward entering the nuclear energy sector. Discussions are underway with the state governments of Madhya Pradesh, Gujarat, and Odisha to identify suitable land for nuclear projects, while also engaging with Nuclear Power Corporation of India and foreign entities for technology and collaboration. This foray into nuclear energy, pending regulatory amendments for private players, signals a long-term strategic bet on India's evolving energy mix. In hydropower, Tata Power has 1 GW of pumped hydro under implementation and plans for an additional 1.8 GW facility, alongside progressing on significant hydro projects in Bhutan. Furthermore, the company continues to expand its power distribution network, actively participating in state discom privatizations and leveraging its existing market leadership.
Valuation and Market Sentiment
Tata Power operates with a market capitalization of approximately ₹1.16 to ₹1.18 trillion as of early February 2026. Its current trailing twelve months (LTM) Price-to-Earnings (P/E) ratio stands around 26.55 to 27.25, which is higher than some state-owned power peers like NTPC (14.0x) and NHPC (25.2x) but lower than JSW Energy (42.0x). Despite the ambitious expansion plans, market sentiment appears cautious. The stock has faced recent downward pressure, trading below its key moving averages, and has received a 'Strong Sell' rating with a Mojo Score of 26.0, recently downgraded from 'Sell' on January 12, 2026. This reflects a shift in valuation grade from 'attractive' to 'fair,' indicating limited immediate upside potential according to some analysts. However, some analysts maintain a 'Buy' rating with a ₹500 target, citing growth drivers in distribution and TP Solar's integration plans. The stock's performance over the past year shows a modest return, within a 52-week range of ₹326.35 to ₹416.80.
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