TORNTPOWER - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 19 Sept 25, 2:16 pm

Fundamental Rating: 4.2

📊 Core Financials Breakdown

Profitability

ROE: 19.3% and ROCE: 17.4% — strong, indicating efficient capital deployment and solid operational performance.

EPS: ₹52.2, though quarterly PAT dropped from ₹1,090 Cr. to ₹685 Cr. (-26.2%) — a short-term dip worth monitoring.

Debt-to-equity: 0.37 — moderate leverage, well-managed for a utility company.

Dividend Yield: 1.48% — decent, offering passive income potential.

Institutional Sentiment

FII holdings increased (+0.36%), while DII holdings declined (-0.49%) — mixed signals, but overall interest remains.

💰 Valuation Metrics

Metric Value Insight

P/E Ratio 24.8 Slightly above industry average (21.6) — fairly valued.

P/B Ratio ~3.71 Reasonable for a capital-intensive utility.

PEG Ratio 0.45 Attractive — suggests undervaluation relative to growth.

Intrinsic Value ~₹1,200–₹1,250 (est.) Current price of ₹1,284 is near fair value.

🧠 Business Model & Competitive Edge

Core Operations: Generation, transmission, and distribution of electricity across multiple Indian states.

Strengths

Integrated utility model with over 3,945 MW installed capacity and 5,000+ km transmission network

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Diversified into renewables, gas distribution, and energy efficiency services.

Backed by Torrent Group — strong governance and financial discipline.

Challenges

Recent profit contraction and bearish technical momentum.

RSI at 49.3 — neutral, MACD at -14.1 — bearish crossover.

📈 Entry Zone & Technicals

DMA 50: ₹1,315, DMA 200: ₹1,403 — price is below both, indicating short-term weakness.

RSI: 49.3 — neutral zone.

MACD: -14.1 — bearish momentum.

📌 Entry Zone: ₹1,200–₹1,250 — ideal for accumulation if price dips further.

🕰️ Long-Term Holding Guidance

2025 Target: ₹1,265–₹1,722

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2026–2030 Target: ₹2,180–₹2,333

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Outlook: Torrent Power is a well-managed utility with strong fundamentals and long-term growth potential in renewables and urban infrastructure.

Holding Strategy: Suitable for long-term investors seeking stable returns and moderate capital appreciation. Accumulate during technical weakness and hold through cycles.

You can explore more on Torrent Power’s Trendlyne dashboard or review its price forecast and valuation insights for deeper context

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www.indmoney.com

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