Tata Power incurred a ₹800 crore loss in the first nine months of FY26 due to the prolonged shutdown of its 4,000 MW Mundra coal-fired plant.
The Mundra shutdown hit earnings as the company lost capacity charges while fixed costs continued, dragging down profits and revenues.
Tata Power expects performance to improve in next quarter, while brokerages flag the delay in signing PPA for the plant as a key drag on near-term results.
Tata Power lost around ₹800 crore in the first nine months of the current financial year 2025-26 (FY26). The company incurred the losses due to the prolonged shutdown of its 4,000 MW Mundra coal-fired plant, which has been non-operational since mid-July last year.
The loss was booked during the last quarter (Q3), and during the quarterly earnings call, CEO Sanjeev Churiwala told analysts that when the plant is shut, the company doesn't get the capacity charges, while fixed costs continues.
3 February 2026
Get the latest issue of Outlook Business
The company's consolidated profit stood nearly flat at ₹1,194.33 crore in the October-December quarter as compared to ₹1,187.54 crore in the year-ago period. However, profit attributable to the owners of the company was down by 25% to ₹772 crore from ₹1,031 crore in the corresponding quarter last year.
It's consolidated revenue was also down 9% year-on-year (YoY) to ₹13,948 crore in the quarter under review from 15,391 primarily due to the non-operational plant. The revenue from thermal and hydro segment plummeted significantly by 78% YoY, standing at ₹2022 crore.
Restarting the unit is crucial for Tata Power because it produces almost 25% of the company’s total electricity output, which stands at about 16 gigawatts. The plant has five large units, each capable of generating 800 MW of power, making it one of Tata Power’s most important facilities.
Brokerage firm, JM Financial noted that delay in signing of Power Purchase Agreement (PPA) for Mundra continues to drag the company's performance. It has estimated the company to report FY25-28 CAGR of 7% in revenue, and 11% and 14% in EBITDA and PAT, respectively.
Sinha said the company expects the plant to start operating again soon, which should result in much better performance than the December quarter and the same period last year. The company also said that discussions with the Gujarat government for a power purchase agreement (PPA) are underway and likely to be wrapped up shortly.
