The share of the company, which is a leading integrated power utility company in India with a presence across generation, transmission, and distribution of power, became bullish after brokerage and other reasons
With a market capitalization of Rs 66,062 crore, Torrent Power Ltd’s share on Thursday made a day high of Rs 1,327 per share, up by 6.1 percent from its previous close of Rs 1,249.70 per share. The stock of the company gave no return or stayed near the same price over the last year.
Investec upgrade strengthens outlook
Investec upgraded Torrent Power to ‘Buy’ and raised its target to Rs 1,515, implying around 21 percent upside from its previous close. The brokerage expects the company to enter a strong 3 to 4 year earnings growth phase, supported by the Nabha Power acquisition and accelerated renewable energy capacity addition.
Nabha Power boosts earnings
Its 1.4 GW power plant, named Nabha Power, would bring in approximately Rs 1,100 crore to EBITDA from FY27, and this transaction would be one of the important drivers of earnings growth for Torrent Power. This additional power capacity would boost the earnings base and improve cash generation.
Renewable pipeline supports growth
The 4.2 GW pipeline of renewable energy projects currently being executed by Torrent Power will help drive growth for the company in terms of asset base and cash flows. According to Investec, the company could potentially earn Rs 13,800 crore worth of operating cash flows in FY27-FY28.
As per the brokerage house, the stock of the company is valued attractively at 10 times the FY28E EV/EBITDA multiple and 2.6 times the price-to-book ratio. But delays in project execution could pose as one of the major risks for the company as it increases its renewable energy segment and executes the Nabha Power acquisition.
Volume surge
There was a spike in volume, which increased from an average of 384,000 shares to 1.74 million shares per day, which represented a 325 percent increase. The spike in volume suggested increased buying interest by investors and participation, thus contributing to the upward trend in the stock.
Technical setup
On a technical basis, the stock was trading below the 50 EMA line and above the 200 EMA line, while the technical indicators showed that the stock was in an oversold condition. In addition, the stock was at an important support line, which would attract more buyers to the stock.
About the Company
Torrent Power is one of the companies that belongs to the Torrent Group and is based in Ahmedabad. The company is an integrated private-sector electricity company with operations in power generation, transmission and distribution. The company’s power generation includes coal, gas, solar and wind plants, whereas the distribution business caters to millions of customers.
Financial highlights: Revenue increased to Rs 8,124 crore in Q1 FY27 from Rs 7,906 crore in Q1 FY26, registering a 3 percent growth YoY. EBITDA rose to Rs 1,538 crore from Rs 1,483 crore, up 4 percent YoY, while net profit declined to Rs 662 crore from Rs 742 crore, down 13 percent YoY. EPS stood at Rs 12.68 in Q1 FY27, down 13 percent from Rs 14.52 in Q1 FY26.