TORNTPOWER - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.4
| Stock Code | TORNTPOWER | Market Cap | 75,571 Cr. | Current Price | 1,499 ₹ | High / Low | 1,824 ₹ |
| Stock P/E | 29.4 | Book Value | 378 ₹ | Dividend Yield | 1.27 % | ROCE | 15.8 % |
| ROE | 14.1 % | Face Value | 10.0 ₹ | DMA 50 | 1,539 ₹ | DMA 200 | 1,438 ₹ |
| Chg in FII Hold | 0.08 % | Chg in DII Hold | 0.08 % | PAT Qtr | 432 Cr. | PAT Prev Qtr | 712 Cr. |
| RSI | 42.7 | MACD | -22.3 | Volume | 2,07,881 | Avg Vol 1Wk | 4,89,113 |
| Low price | 1,188 ₹ | High price | 1,824 ₹ | PEG Ratio | 3.60 | Debt to equity | 0.44 |
| 52w Index | 48.9 % | Qtr Profit Var | -60.4 % | EPS | 51.1 ₹ | Industry PE | 32.1 |
📊 Core Financials
Revenue Growth: PAT declined (₹432 Cr vs ₹712 Cr), showing short-term weakness.
Profit Margins: Margins remain stable but under pressure.
Debt Ratios: Debt-to-equity 0.44, moderate leverage.
Cash Flows: Positive operating cash flows supported by power generation and distribution.
Return Metrics: ROCE 15.8%, ROE 14.1% — moderate efficiency and shareholder returns.
💹 Valuation Indicators
P/E Ratio: 29.4, slightly below industry average (32.1), reasonable valuation.
P/B Ratio: ~3.96 (Price ₹1499 / Book Value ₹378), moderate.
PEG Ratio: 3.60, stretched relative to growth.
Intrinsic Value: Fair value closer to ₹1350–1400, current price slightly overvalued.
Dividend Yield: 1.27%, attractive compared to peers.
🏢 Business Model & Competitive Advantage
Operates in power generation, transmission, and distribution.
Strong presence in renewable energy and conventional power projects.
Competitive edge: diversified portfolio, government contracts, and steady demand.
Challenges: regulatory risks, high capex requirements, and profit volatility.
📈 Entry Zone & Long-Term Guidance
Entry Zone: ₹1350–1400 (value zone near intrinsic).
Long-Term Holding: Suitable for investors seeking exposure to power sector growth, with moderate risk.
✅ Positive
ROCE 15.8% and ROE 14.1% reflect decent efficiency.
Dividend yield 1.27% provides income support.
Debt-to-equity moderate at 0.44.
FII (+0.08%) and DII (+0.08%) holdings increased.
⚠️ Limitation
PAT declined sharply (₹432 Cr vs ₹712 Cr).
PEG ratio high (3.60).
RSI at 42.7 indicates weak momentum.
🚨 Company Negative News
Quarterly profit variation (-60.4%) shows volatility.
MACD negative (-22.3), bearish technical trend.
Profitability under pressure despite revenue base.
🌟 Company Positive News
Strong institutional support from FIIs and DIIs.
Technical support near DMA 200 (₹1438).
52-week performance up 48.9%.
🏭 Industry
Power sector driven by renewable energy adoption, infrastructure expansion, and government initiatives.
Industry PE ~32.1, TORNTPOWER trades at slight discount.
Growth drivers: rising electricity demand, clean energy transition, and urbanization.
📌 Conclusion
TORNTPOWER is a moderately strong power sector stock with stable fundamentals, decent returns, and attractive dividend yield. However, profit volatility and stretched PEG ratio limit upside. Entry advisable near ₹1350–1400. Long-term holding suitable for investors seeking exposure to power generation and renewable energy growth, provided they enter at value levels.
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