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Tata Power expects India's electricity demand to grow 6-7% in FY27 and remains on track to invest ₹25,000 crore this financial year 2026-27 (FY27) as it expands its renewable energy, transmission and distribution businesses, CEO and Managing Director Dr Praveer Sinha said.
Sinha said the utility is seeing sustained electricity demand and expects project execution to accelerate despite seasonal disruptions in the second quarter. He also said discussions on Mundra power purchase agreements, nuclear power and distribution reforms are progressing.
India's integrated power company spent ₹5,300 crore during the April-June 2026 quarter, its highest-ever first-quarter capital expenditure. Sinha said around 2.5 GW of utility-scale renewable capacity will be commissioned this year alongside expansion of transmission and distribution infrastructure.
Sinha said the company's 4.3 GW solar cell and module facility is operating at full capacity after crossing 1 GW of module production in a single quarter for the first time.
The company is not planning to add more solar cell and module capacity because of excess capacity in the domestic market. Instead, it will invest in wafer and ingot manufacturing through two phases of 5 GW each, with construction beginning in October and commissioning targeted for January 2028.
Sinha said agreements with three states are expected to be completed by August and the fourth by September. Once all supplementary power purchase agreements (SPPAs) are signed, the Mundra power plant project is expected to operate on a cost pass-through basis.
Sinha also said the Uttar Pradesh discom privatisation process has been paused until after the state elections, but expects progress on parallel distribution licensing and other power sector reforms over the next six months.
He said Tata Power is in advanced discussions with the Department of Atomic Energy and NPCIL and has already started land acquisition and geotechnical studies at three potential sites. The company is evaluating both 220 MW and 700 MW reactor units and expects greater clarity after the government notifies licensing rules.
The company has a market capitalisation of ₹1,18,611 crore.
This is an edited transcript of the interview.Q: Let's start off with a couple of basic points first. How are the demand trends shaping up on a subdued FY26 base? What are you pencilling in terms of growth for FY27, and how are the trends in Q2?A: I think the power demand this year has gone up. In May, we saw an increase of nearly 11%, and in June, it was more than 9-9.8%. So, there is a huge demand for power, and especially with the rains missing their timeline, I do believe that throughout the year we will have strong demand for power.
The good news is that all over the country, capacity additions have taken place, and that is able to meet the peak requirement and also the sustained requirement, which we are seeing at more than 260 to 270 GW. So, it's good news for us. All our operations—generation, transmission, distribution, and our renewable portfolio—are doing very well. So, it's a good place to be in the sector at this time for the business.
Q: Do you want to put a number to that, though, in terms of what kind of demand growth you are working with?A: We are definitely looking at 6% to 7% for the whole year.
Q: The Mundra issues are largely resolved. Gujarat's on board. When will the rest of the states sign the SPPAs? A: So, we are in a very advanced stage of discussions with the other four states. Three of them, actually, have their Cabinet notes being prepared, and hopefully within August we should be able to conclude those. We expect the fourth one to happen in September.
So, I think everyone is on board. Everyone wants to go ahead, and they are already taking power under Section 11, but with the tariff under the SPPA. So, they are already availing themselves of the benefit of the SPPA.
Q: Could you talk to us a little bit about what's happening with the UP discom privatisation process? Is there still interest? Has interest fizzled out? Where is the process at?A: So, I would say it's not fizzled out, but it is stalled at present. UP goes into elections next year in February or March, and I think they will hold this till the elections are over. I do expect that UP will go off the block.
Also, there is a lot of interest being shown by a few of the other states, including for parallel licensing. The Government of India is very keen to take it forward. So, I do expect that in the next six months, many of the states will go for parallel licensing, as well as some of the other distribution reforms, including PPA and other arrangements. So, this will be a good opportunity for us going forward.
Q: On parallel licensing—Goa and Karnataka. There are reports from both states, and you said perhaps others will take this up as well. Could you give us a sense of whether this is earnings accretive?A: So basically, in parallel licensing, you don't create distribution infrastructure once again, except where the infrastructure is not available. So, there is no duplication of infrastructure. It's a better utilisation of the infrastructure that takes place, and competition always brings better results for the consumer.
So, from a consumer perspective, it is very good. Even for the existing discom, because the network is utilised more, its earning potential increases. For the state government too, the losses at the state discoms are reduced tremendously. So, it's a win-win for everyone, and I do hope that it will happen in some of the states where we are in discussion.
Also, the regulatory mandate as well as the policy mandate through policy interventions from the Government of India should move forward, and we do expect that this will bring much competition and freshness to the distribution sector, which is much needed.
Q: Your solar revenue is up 53% and margins are at 25%. Is that sustainable?A: Yes, absolutely. In fact, that's the model that we are working on, and I do expect that in the subsequent quarters you will see much better results, now that all these are operating at a very good performance level.
Q: And you have plans to scale to 10 GW of cell, module and ingot integration. What has been spent so far? What is the total capacity that's commissioned, and what is the timeline to ramp it up?A: We have the 4.3 GW cell and module plant, which is operating at a very good capacity, and we have seen that in the last quarter, for the first time, it crossed 1 GW of module manufacturing in a single quarter. We expect this pace to continue because now the plant is fully ramped up and is working at the highest efficiency levels. We don't have plans to add to the cell and module capacity because there is already overcapacity in the country. We are setting up a wafer and ingot plant in two stages of 5 GW each. The work will start in October, and we will commission the plant by January 2028.
Q: And your overall capex number? I think last time you had spoken about ₹25,000 crore of capex for the company in FY27. How much has been spent so far, and does this number hold?A: So, in the first quarter, we spent ₹5,300 crore. This is a record first-quarter spend, and this demonstrates that many of our projects, which we are implementing this year, are showing very good traction. We do expect that this will continue going forward.
Of course, the second quarter is a little muted because of the rains, but in the third and fourth quarters, we will be able to catch up and reach ₹25,000 crore. You will see a lot of capacity addition. About 2.5 GW of large utility-scale renewable projects will come up. Apart from that, the transmission lines, the distribution business, and the Mumbai transmission project will progress. So, we are very confident of achieving these numbers.
Q: On Mundra, you spoke about how the three states are likely to sign on by August and perhaps the fourth one by September. So once this cost pass-through framework kicks in with all these additional states, what would the profitability of Mundra look like?A: So, we will be virtually quid on this because the arrangement is that the coal cost is a pass-through, and all the other costs will be on an actual basis so that they are cost-reflective. So it's not that we'll make a profit on that, but we'll not make a loss at Mundra.
Q: An out-of-the-box question on the plans regarding the nuclear opportunity. The bill has been passed. Is the group thinking of it in a serious way? We've had this chat before, a long time ago. Anything moving there?A: I think we have been in very advanced discussions with both the Department of Atomic Energy as well as NPCIL, and we are waiting for the rules to come, covering the licensing conditions and requirements, and also how the fuel tie-up will take place.
Meanwhile, our discussions are going on with NPCIL in terms of the type of technology support they will provide. Typically, they have the 220 MW units and also the 700 MW units. We are also in discussions with the Department of Atomic Energy in terms of what will be the long-term sourcing of uranium and other fuels that we require.
So, the discussions are progressing well. We have already started the process of acquisition of land in three places. The geotechnical studies are going on, and possibly over the next six months, the studies will get over, and we'll be ready at that time to start seeking the various approvals required to set up this plant.
Q: Would you look at the 220 MW units or the 700 MW ones?A: So, we are looking at both the 220 MW units. Typically, they are set up in pairs, so two 220 MW units. We are also looking at two 700 MW units, but again, availability of water and other factors will be the determining factors.
Q: But all the liability issues, etc., those are all sorted out now, right?A: Yes, that is part of the bill, and that will also get reflected in the rules that will be notified.
Q: Any capital expenditure, anything you're thinking of? Because these are large, long-gestation projects and capex-heavy. What would be the intention to invest here?A: So right now, we have not got into the details of it. We already have a huge capex plan of ₹1 lakh crore over the next five years. So, this will be over and above that. Once we have better clarity on whether it is the 220 MW or 700 MW units, we'll be able to come back with the details of the capex plan.
For the full interview, watch the accompanying videoCatch all the latest updates from the stock market here
Sinha said the utility is seeing sustained electricity demand and expects project execution to accelerate despite seasonal disruptions in the second quarter. He also said discussions on Mundra power purchase agreements, nuclear power and distribution reforms are progressing.
India's integrated power company spent ₹5,300 crore during the April-June 2026 quarter, its highest-ever first-quarter capital expenditure. Sinha said around 2.5 GW of utility-scale renewable capacity will be commissioned this year alongside expansion of transmission and distribution infrastructure.
Sinha said the company's 4.3 GW solar cell and module facility is operating at full capacity after crossing 1 GW of module production in a single quarter for the first time.
The company is not planning to add more solar cell and module capacity because of excess capacity in the domestic market. Instead, it will invest in wafer and ingot manufacturing through two phases of 5 GW each, with construction beginning in October and commissioning targeted for January 2028.
Sinha said agreements with three states are expected to be completed by August and the fourth by September. Once all supplementary power purchase agreements (SPPAs) are signed, the Mundra power plant project is expected to operate on a cost pass-through basis.
Sinha also said the Uttar Pradesh discom privatisation process has been paused until after the state elections, but expects progress on parallel distribution licensing and other power sector reforms over the next six months.
He said Tata Power is in advanced discussions with the Department of Atomic Energy and NPCIL and has already started land acquisition and geotechnical studies at three potential sites. The company is evaluating both 220 MW and 700 MW reactor units and expects greater clarity after the government notifies licensing rules.
The company has a market capitalisation of ₹1,18,611 crore.
This is an edited transcript of the interview.Q: Let's start off with a couple of basic points first. How are the demand trends shaping up on a subdued FY26 base? What are you pencilling in terms of growth for FY27, and how are the trends in Q2?A: I think the power demand this year has gone up. In May, we saw an increase of nearly 11%, and in June, it was more than 9-9.8%. So, there is a huge demand for power, and especially with the rains missing their timeline, I do believe that throughout the year we will have strong demand for power.
The good news is that all over the country, capacity additions have taken place, and that is able to meet the peak requirement and also the sustained requirement, which we are seeing at more than 260 to 270 GW. So, it's good news for us. All our operations—generation, transmission, distribution, and our renewable portfolio—are doing very well. So, it's a good place to be in the sector at this time for the business.
Q: Do you want to put a number to that, though, in terms of what kind of demand growth you are working with?A: We are definitely looking at 6% to 7% for the whole year.
Q: The Mundra issues are largely resolved. Gujarat's on board. When will the rest of the states sign the SPPAs? A: So, we are in a very advanced stage of discussions with the other four states. Three of them, actually, have their Cabinet notes being prepared, and hopefully within August we should be able to conclude those. We expect the fourth one to happen in September.
So, I think everyone is on board. Everyone wants to go ahead, and they are already taking power under Section 11, but with the tariff under the SPPA. So, they are already availing themselves of the benefit of the SPPA.
Q: Could you talk to us a little bit about what's happening with the UP discom privatisation process? Is there still interest? Has interest fizzled out? Where is the process at?A: So, I would say it's not fizzled out, but it is stalled at present. UP goes into elections next year in February or March, and I think they will hold this till the elections are over. I do expect that UP will go off the block.
Also, there is a lot of interest being shown by a few of the other states, including for parallel licensing. The Government of India is very keen to take it forward. So, I do expect that in the next six months, many of the states will go for parallel licensing, as well as some of the other distribution reforms, including PPA and other arrangements. So, this will be a good opportunity for us going forward.
Q: On parallel licensing—Goa and Karnataka. There are reports from both states, and you said perhaps others will take this up as well. Could you give us a sense of whether this is earnings accretive?A: So basically, in parallel licensing, you don't create distribution infrastructure once again, except where the infrastructure is not available. So, there is no duplication of infrastructure. It's a better utilisation of the infrastructure that takes place, and competition always brings better results for the consumer.
So, from a consumer perspective, it is very good. Even for the existing discom, because the network is utilised more, its earning potential increases. For the state government too, the losses at the state discoms are reduced tremendously. So, it's a win-win for everyone, and I do hope that it will happen in some of the states where we are in discussion.
Also, the regulatory mandate as well as the policy mandate through policy interventions from the Government of India should move forward, and we do expect that this will bring much competition and freshness to the distribution sector, which is much needed.
Q: Your solar revenue is up 53% and margins are at 25%. Is that sustainable?A: Yes, absolutely. In fact, that's the model that we are working on, and I do expect that in the subsequent quarters you will see much better results, now that all these are operating at a very good performance level.
Q: And you have plans to scale to 10 GW of cell, module and ingot integration. What has been spent so far? What is the total capacity that's commissioned, and what is the timeline to ramp it up?A: We have the 4.3 GW cell and module plant, which is operating at a very good capacity, and we have seen that in the last quarter, for the first time, it crossed 1 GW of module manufacturing in a single quarter. We expect this pace to continue because now the plant is fully ramped up and is working at the highest efficiency levels. We don't have plans to add to the cell and module capacity because there is already overcapacity in the country. We are setting up a wafer and ingot plant in two stages of 5 GW each. The work will start in October, and we will commission the plant by January 2028.
Q: And your overall capex number? I think last time you had spoken about ₹25,000 crore of capex for the company in FY27. How much has been spent so far, and does this number hold?A: So, in the first quarter, we spent ₹5,300 crore. This is a record first-quarter spend, and this demonstrates that many of our projects, which we are implementing this year, are showing very good traction. We do expect that this will continue going forward.
Of course, the second quarter is a little muted because of the rains, but in the third and fourth quarters, we will be able to catch up and reach ₹25,000 crore. You will see a lot of capacity addition. About 2.5 GW of large utility-scale renewable projects will come up. Apart from that, the transmission lines, the distribution business, and the Mumbai transmission project will progress. So, we are very confident of achieving these numbers.
Q: On Mundra, you spoke about how the three states are likely to sign on by August and perhaps the fourth one by September. So once this cost pass-through framework kicks in with all these additional states, what would the profitability of Mundra look like?A: So, we will be virtually quid on this because the arrangement is that the coal cost is a pass-through, and all the other costs will be on an actual basis so that they are cost-reflective. So it's not that we'll make a profit on that, but we'll not make a loss at Mundra.
Q: An out-of-the-box question on the plans regarding the nuclear opportunity. The bill has been passed. Is the group thinking of it in a serious way? We've had this chat before, a long time ago. Anything moving there?A: I think we have been in very advanced discussions with both the Department of Atomic Energy as well as NPCIL, and we are waiting for the rules to come, covering the licensing conditions and requirements, and also how the fuel tie-up will take place.
Meanwhile, our discussions are going on with NPCIL in terms of the type of technology support they will provide. Typically, they have the 220 MW units and also the 700 MW units. We are also in discussions with the Department of Atomic Energy in terms of what will be the long-term sourcing of uranium and other fuels that we require.
So, the discussions are progressing well. We have already started the process of acquisition of land in three places. The geotechnical studies are going on, and possibly over the next six months, the studies will get over, and we'll be ready at that time to start seeking the various approvals required to set up this plant.
Q: Would you look at the 220 MW units or the 700 MW ones?A: So, we are looking at both the 220 MW units. Typically, they are set up in pairs, so two 220 MW units. We are also looking at two 700 MW units, but again, availability of water and other factors will be the determining factors.
Q: But all the liability issues, etc., those are all sorted out now, right?A: Yes, that is part of the bill, and that will also get reflected in the rules that will be notified.
Q: Any capital expenditure, anything you're thinking of? Because these are large, long-gestation projects and capex-heavy. What would be the intention to invest here?A: So right now, we have not got into the details of it. We already have a huge capex plan of ₹1 lakh crore over the next five years. So, this will be over and above that. Once we have better clarity on whether it is the 220 MW or 700 MW units, we'll be able to come back with the details of the capex plan.
For the full interview, watch the accompanying videoCatch all the latest updates from the stock market here
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