⚠ Disclaimer: This report is generated using AI tools and is for informational purposes only. It does not constitute investment advice. Please consult a registered financial advisor before making any investment decisions.
RPOWER - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 1.7
| Stock Code | RPOWER | Market Cap | 11,270 Cr. | Current Price | 27.3 ₹ | High / Low | 76.5 ₹ |
| Book Value | 23.6 ₹ | Dividend Yield | 0.00 % | ROCE | -0.18 % | ROE | -0.99 % |
| Face Value | 10.0 ₹ | DMA 50 | 34.5 ₹ | DMA 200 | 41.5 ₹ | Chg in FII Hold | 0.16 % |
| Chg in DII Hold | -0.70 % | PAT Qtr | -0.67 Cr. | PAT Prev Qtr | 4.73 Cr. | RSI | 31.1 |
| MACD | -2.21 | Volume | 2,39,08,073 | Avg Vol 1Wk | 5,54,36,546 | Low price | 26.8 ₹ |
| High price | 76.5 ₹ | Debt to equity | 0.62 | 52w Index | 0.87 % | Qtr Profit Var | -309 % |
| EPS | -0.24 ₹ | Industry PE | 25.6 |
📊 Core Financials
- Revenue & Profitability: Quarterly PAT at -₹0.67 Cr, down from ₹4.73 Cr, showing continued losses. EPS at -₹0.24 reflects negative earnings.
- Margins: ROE at -0.99% and ROCE at -0.18% highlight poor efficiency and negative returns.
- Debt Ratios: Debt-to-equity at 0.62 indicates moderate leverage, but losses make debt sustainability a concern.
- Cash Flows: Weak profitability suggests stressed cash flows despite moderate debt levels.
💹 Valuation Indicators
- P/E Ratio: Not meaningful due to negative earnings.
- P/B Ratio: Current price ₹27.3 vs. book value ₹23.6 → ~1.16x, fairly aligned with assets.
- PEG Ratio: Not applicable due to negative earnings growth.
- Intrinsic Value: Persistent losses erode intrinsic worth, limiting valuation appeal.
🏢 Business Model & Competitive Advantage
- Reliance Power operates in power generation across thermal, hydro, and renewable projects.
- Competitive advantage lies in asset base and diversified energy portfolio.
- However, weak profitability, high project risks, and declining investor confidence undermine overall health.
📈 Entry Zone & Long-Term Guidance
- Entry Zone: Risky accumulation only near ₹26 – ₹28, close to current lows.
- Long-Term Holding: High-risk investment; suitable only for speculative investors betting on turnaround. Conservative investors should avoid until profitability stabilizes.
✅ Positive
- Debt-to-equity ratio of 0.62 is moderate compared to peers.
- Stock trading near book value (~1.16x).
- FII holding increased (+0.16%), showing marginal foreign investor interest.
⚠️ Limitation
- Negative ROE (-0.99%) and ROCE (-0.18%).
- Persistent losses with EPS at -₹0.24.
- No dividend yield, reducing investor appeal.
📉 Company Negative News
- Quarterly PAT declined to -₹0.67 Cr from ₹4.73 Cr.
- DII holding decreased (-0.70%), showing reduced domestic institutional confidence.
- Profit variation of -309% highlights severe instability.
📈 Company Positive News
- FII holding increased (+0.16%).
- Stock trading close to 52-week low may attract speculative interest.
🏭 Industry
- Power sector trades at industry PE of 25.6, but RPOWER’s losses make P/E irrelevant.
- Sector growth supported by renewable energy expansion, though company-specific risks dominate.
🔎 Conclusion
- Reliance Power is asset-backed but financially weak, with persistent losses and negative return metrics.
- Valuation appears cheap relative to book value, but profitability concerns make it a speculative bet.
- Best avoided by conservative investors; speculative entry possible near ₹26 – ₹28 if turnaround prospects improve.
I can also prepare a comparative HTML snapshot of RPOWER versus NTPC to highlight how a profitable power generator differs in valuation and financial health.