Tata Power vs Adani Power: Which stock to buy after Q1 results 2025? EXPLAINED

Mint

2 days ago

Tata Power vs Adani Power: Indian power majors, Tata Power and Adani Power, declared their Q1 results 2025 on Friday. Both companies reported a strong set of numbers. Adani Power boasts a strong PAT 9Profit After Tax) and EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortisation), while Tata Power reported its 23rd consecutive quarter of PAT growth, with a strong focus on clean energy, manufacturing, and distribution expansion. This is expected to put Adani Power and Tata Power shares under the bulls' radar on Monday, as these companies have reported strong Q1 results despite weak power demand.
Speaking on the Q1 results 2025 reported by these Indian power majors, Seema Srivastava, Senior Research Analyst at SMC Global Securities, said, "During Q1FY26, Adani Power boasts a strong Profit After Tax of ₹ 3,305 crore and Continuing EBITDA of ₹ 5,744 crore, showcasing its resilience. Its strategic focus on swift project execution, strategic acquisitions, and sustainability positions it for future growth towards its 30 GW target by 2030. On the other hand, Tata Power has a 6% YoY growth in Profit After Tax, marking its 23rd consecutive quarter of PAT growth, with a strong focus on clean energy, manufacturing, and distribution expansion."
Speaking on Adani Power Q1 results, Gaurav Goel, Founder & Director at Fynocrat Technologies, said, "Adani Power has reported a strong profit of ₹ 3,305 crore, which is slightly lower than last year's ₹ 3,912 crore but still solid, especially considering weaker power demand due to early monsoons and lower merchant tariffs. Revenue also dipped a bit to ₹ 14,167 crore. But despite that, their operating margins stayed healthy, and EBITDA came in at ₹ 5,744 crore, which is a good recovery from last quarter."
"What stands out is their focus on scale and efficiency. Even in a low-demand quarter, they remained stable, mainly because of their strong base of long-term PPAs and good cost control. Of course, recent acquisitions have added to depreciation, which is putting some pressure on profits," Goel said, adding, "Tata Power reported higher revenue at ₹ 17,464 crore, but a much lower profit of ₹ 1,262 crore. It looks like underperformance compared to Adani POWER, but there's more to the story."
"Tata Power is clearly in a transition phase, shifting focus to clean and green energy. Around 44% of their current capacity is now renewable, and they're aiming for 70% by 2030. That kind of shift requires a lot of investment, and that's showing up in the short-term earnings. But they're building long-term value. They're also growing in areas like EV charging and rooftop solar, which could become strong drivers in the future," Gaurav Goel of Fynocrat Technologies said.
On which stock to buy after the announcement of Q1 results 2025, Seema Srivastava of SMC Global said, "For a long-term perspective, Adani Power appears more attractive due to its higher growth potential and lower P/E ratio of around 10-15, compared to Tata Power's P/E ratio of around 32-40. Adani Power's aggressive expansion plans and strategic partnerships, like regular payments from Bangladesh, underscore its core strengths and competitive edge. However, Tata Power's diversified portfolio and strong brand reputation make it a stable choice."
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.