Yes it is possible. you need to create several groups in moodle from Settings > Course administration > Users > Groups. Then assign students in these groups and one teacher to each group. After that go to Settings > Site administration > Users > permissions > define roles > teacher. Edit the below capabilities :
Access all group - Prevent (prevent option is only available when you click on show Advanced tab on that page)
Then go to course setting page and set separate groups and force group mode to yes.
Then check the grade report, it will show reports to teacher of his group only.