TORNTPOWER - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 4.1
| Stock Code | TORNTPOWER | Market Cap | 87,478 Cr. | Current Price | 1,736 ₹ | High / Low | 1,824 ₹ |
| Stock P/E | 27.1 | Book Value | 370 ₹ | Dividend Yield | 1.09 % | ROCE | 16.9 % |
| ROE | 18.7 % | Face Value | 10.0 ₹ | DMA 50 | 1,514 ₹ | DMA 200 | 1,414 ₹ |
| Chg in FII Hold | 0.08 % | Chg in DII Hold | 0.08 % | PAT Qtr | 712 Cr. | PAT Prev Qtr | 746 Cr. |
| RSI | 68.1 | MACD | 82.6 | Volume | 8,17,045 | Avg Vol 1Wk | 12,27,403 |
| Low price | 1,188 ₹ | High price | 1,824 ₹ | PEG Ratio | 0.51 | Debt to equity | 0.38 |
| 52w Index | 86.2 % | Qtr Profit Var | 93.2 % | EPS | 64.2 ₹ | Industry PE | 30.5 |
📊 TORNTPOWER demonstrates strong fundamentals with ROE at 18.7% and ROCE at 16.9%, reflecting efficient capital usage. EPS of 64.2 ₹ supports profitability, and dividend yield of 1.09% adds investor appeal. Debt-to-equity ratio of 0.38 indicates moderate leverage, manageable for a power utility. Valuation appears fair with P/E at 27.1 compared to industry average of 30.5, while PEG ratio of 0.51 suggests undervaluation relative to growth prospects. Quarterly PAT declined slightly (712 Cr. vs 746 Cr.), but year-on-year profit variation (+93.2%) highlights strong earnings momentum. Technical indicators (RSI 68.1, MACD 82.6) show bullish momentum, with price trading well above 50 DMA (1,514 ₹) and 200 DMA (1,414 ₹).
💡 Entry Price Zone: Attractive accumulation between 1,600 ₹ – 1,680 ₹ near valuation comfort and DMA support. Buying closer to 1,700+ ₹ carries short-term overbought risk.
📈 Long-Term Holding Guidance: TORNTPOWER is fundamentally strong and suitable for long-term holding (3–5 years). Investors should monitor quarterly earnings and RSI levels. Holding is justified if profitability sustains and sector demand remains robust.
Positive
- Strong ROE (18.7%) and ROCE (16.9%).
- EPS of 64.2 ₹ supports valuation strength.
- PEG ratio of 0.51 indicates undervaluation relative to growth.
- Dividend yield of 1.09% adds investor appeal.
- Institutional support improved (FII +0.08%, DII +0.08%).
Limitation
- Quarterly PAT declined (712 Cr. vs 746 Cr.).
- RSI at 68.1 suggests near overbought territory.
- Volume (8.17 lakh) below weekly average (12.27 lakh), showing reduced trading interest.
- Moderate leverage with debt-to-equity ratio of 0.38.
Company Negative News
- Sequential decline in quarterly profits.
- Overbought technical indicators may trigger short-term corrections.
Company Positive News
- Strong year-on-year profit variation (+93.2%).
- Stock trading near 52-week high (1,824 ₹), reflecting investor optimism.
- Institutional support improved with both FII and DII inflows.
Industry
- Power sector outlook remains positive with steady demand and infrastructure expansion.
- Industry PE at 30.5 is higher than TORNTPOWER’s 27.1, suggesting relative undervaluation.
Conclusion
✅ TORNTPOWER is a fundamentally strong company with solid ROE/ROCE and undervaluation on PEG basis, making it a strong candidate for long-term investment. Entry is best near 1,600–1,680 ₹, with exit opportunities around 1,800–1,820 ₹ if momentum sustains. Conservative investors should monitor RSI and quarterly earnings before committing heavily.
Would you like me to extend this into a power sector overlay HTML comparing TORNTPOWER with NTPC, Adani Power, and Tata Power for sharper benchmarking?