Torrent Power Ltd

Price story Before the numbers, the tape. A stock price moves through four repeating seasons: a flat base (stage 1), an advance (2), a top (3), a decline (4). Where the price sits in that cycle frames everything below.

Torrent Power Ltd trades at ₹1,298, in a downtrend and 6 weeks into that stage. That is −6.9% against its own 200-day average. It sits at 15% of a 52-week range of ₹1,218 to ₹1,736. On relative strength it is currently behind the NIFTY 500 on a trailing-13-week view (15 weeks and counting).

Today the stock is in a downtrend — week 6 of stage 4, confirmed. At ₹1,298 it trades −6.9% versus its 200-day average and sits at 15% of its 52-week range (₹1,218–₹1,736).

Against the market, two honest reads. Cumulative: over the last 10.5 years the stock moved +496% while the NIFTY 500 moved +273% — ahead of the index over the full window. Recent form: on a trailing-13-week view the stock is currently behind (15 weeks and counting; last ahead the week of 2026-06-17) — the ribbon below is that same metric, week by week.

What would end the trend, mechanically: two Friday closes in a row below the 200-day line. That is the exit rule — no debates.

Story check

Torrent Power Ltd's story is not scored yet against the markers our research file set on 17 May 2026. Where it sits in its own cycle: CONTRACTION.

Our read, 17 May 2026. A regulated utility at a PE cyclical trough — an Rs 68,000–80,000 crore capex avalanche is about to compound earnings for 6 years, if management can close the execution gap.

From the numbers. PE at 83rd percentile of 10Y range (current 27.1x vs median 14.55x) — optically expensive. However, cycle_position is MID_CONTRACTION with PEAK_WARNING EPS setup, suggesting earnings are cyclically compressed by…

From the price. Price stage 4, week 6 — below its 200-day line, relative strength falling.

From the research. A regulated utility at a PE cyclical trough — an Rs 68,000–80,000 crore capex avalanche is about to compound earnings for 6 years, if management can close the execution gap.

🚨 Where they disagree. PE at 83rd percentile of 10Y range (current 27.1x vs median 14.55x) — optically expensive. However, cycle_position is MID_CONTRACTION with PEAK_WARNING EPS setup, suggesting earnings are cyclically compressed by maintenance, one-offs, and LNG pricing. FY26 PAT Rs 2,469 Cr is below FY25 Rs 3,059 Cr (–19%) — Nabha accretion + RE commissioning is the rerating catalyst. FII_SELLING is the institutional caution signal.

What is proven. A regulated utility at a PE cyclical trough — an Rs 68,000–80,000 crore capex avalanche is about to compound earnings for 6 years, if management can close the execution gap.

What is not proven yet. Torrent cash outflow Rs 4,100 Cr + Rs 2,733 Cr Napa debt assumed; leverage more than doubles from pre-Nabha 0.40 D/E — any commissioning slip in FY27 makes the interest burden outpace operating leverage gains.

The test written in advance. Elevated post-Nabha leverage (pro forma net debt/EBITDA 5.5–6x) constrains credit ratios — Elevated post-Nabha leverage (pro forma net debt/EBITDA 5.5–6x) constrains credit ratios Nabha closure Q1 FY27 + net debt/EBITDA trajectory after Q1 FY27 results by the next result.

The test written in advance. FY27 RE commissioning shortfall (3rd consecutive miss potential) — FY27 RE commissioning shortfall (3rd consecutive miss potential) Cumulative RE commissioning in H1 FY27 (Q1 + Q2 concalls) — must show 400+ MW in 6 months by the next result.

The test written in advance. LNG price spike (current $16–20 spot) sustains merchant uneconomics through FY27 — LNG price spike (current $16–20 spot) sustains merchant uneconomics through FY27 LNG spot price vs Rs 6.00/kWh break-even; JERA deal commissioning CY27 by the next result.

Lever 2 · Value-added mix — BUILDING. Every MW commissioned adds near-zero-marginal-cost generation; 1.2–1.4 GW in FY27 at ~Rs 5–6 Cr EBITDA/MW = Rs 6,000–8,400 Cr incremental EBITDA over 4 years on FY27 capacity alone. What proves it keeps working: Renewable Energy Operating Leverage (4 GW pipeline, 1.2–1.4 GW FY27). It stops working if Nabha closure Q1 FY27 + net debt/EBITDA trajectory after Q1 FY27 results.

Lever 1 · Operating leverage — BUILDING. Rs 6,800 Cr EV for adjusted EBITDA Rs 1,153 Cr at 5.97x — day-one accretion to group PAT; capacity base grows 5 GW → 6.4 GW (+28%). What proves it keeps working: Nabha Power Acquisition (1,400 MW coal, >15% IRR day-one, Q1 FY27 close). It stops working if Nabha closure Q1 FY27 + net debt/EBITDA trajectory after Q1 FY27 results.

Lever 9 · Buyback — BUILDING. Assets capitalised post-April 2025 earn 13% base ROE rising to 15% with performance incentives vs 14% flat prior; carrying cost orders (Rs 186 Cr in March 2026) are recurring, not one-off. What proves it keeps working: Distribution ROCE Modernisation (new MYT regime, 13→15% ROE, performance incentives). It stops working if Nabha closure Q1 FY27 + net debt/EBITDA trajectory after Q1 FY27 results.

Lever 6 · Order-book wins — BUILDING. 1.6 GW MP coal (PSA executed, LoAs issued, environmental clearance received; tariff Rs 5.8983/unit) + 3 GW PSH (MSEDCL agreement, LoAs, environmental clearance; Oct 2028 COD target) — adds 4.6 GW capacity by FY31. What proves it keeps working: Thermal Expansion — MP 1.6 GW Coal + 3 GW Pumped Storage Hydro. It stops working if Nabha closure Q1 FY27 + net debt/EBITDA trajectory after Q1 FY27 results.

Sources: our stock research file (17 May 2026) · quarterly results through Jun 26 · the company’s own earnings calls. The story check is re-scored every results season; the record below never changes.

Revenue Revenue is the top line: everything the company billed its customers in the period.

Torrent Power Ltd reported ₹8,124 Cr of revenue in the Jun 26 quarter, +2.8% year on year. Over 10 years it has compounded at 9.5% a year. The last full year, FY26, came in at ₹28,966 Cr. The last four reported quarters add to ₹29,184 Cr.

Why this happened. MP thermal 1.6 GW: power sale agreement executed with MP Power Management Company at Rs 5.8983/kWh (Rs 4.22 fixed + Rs 6.00 variable); boiler, turbine, generator, balance-of-plant LoAs issued; environmental clearance received. COD targeted within 66 months of PTA signing (PTA expected within 2 months from Nov 2025 concall). Pumped Storage: 3 GW total (2 GW contracted MSEDCL 40-year + 1 GW merchant); civil/hydro-mechanical + electrical/mechanical LoAs issued; environmental clearance secured; October 2028 COD target. Together these add contracted baseload coal and storage capacity, both at declared IRR thresholds. These are FY30–31 earnings contributors, not near-term.

FY26 revenue came in at ₹28,966 Cr (−0.7% on the year), capping 10 years at 9.5% compound. The latest quarter (Jun 26) printed ₹8,124 Cr, +2.8% year on year.

Pace check: the last four quarters averaged +4.0% growth against the decade's 9.5% — the current year is running slower than its own long-run rate.

Acceleration check: trailing-twelve-month revenue grew +4.1% over the last 4 quarters against +0.5%/yr over the last 8 — accelerating; TTM profit −14.8% vs +0.6%/yr — rolling over.

Operating margin Operating margin is what is left of every ₹100 of sales after running the business, before interest and tax. It is the cleanest read on pricing power and cost control.

Torrent Power Ltd's operating margin is 19.0% in the Jun 26 quarter, +0.0 percentage points against the same quarter a year ago. Across 13 fiscal years the operating margin has ranged 15.0% to 29.0%. The current quarter sits inside that band.

Why this happened. Torrent Power has a 4 GW renewable pipeline with total capex Rs 28,000 Cr. FY26 commissioned only ~200 MW (lackluster, acknowledged). FY27 guide is 1.2–1.4 GW — a 6–7x step-up. 603 MW merchant wind (peak-hour targeted) + 860 MW C&I under construction. Once commissioned, incremental EBITDA accrues at near-zero fuel cost. The SECI 367 MW project is 95% commissioned; final 5% awaits government land replacement (6–9 months). Operating leverage is real and multi-year, but the FY26 execution gap creates credibility discount on FY27 targets.

The latest quarter's operating margin is 19.0%, +0.0 pp against the same quarter a year ago. Across 13 fiscal years the operating margin has ranged 15.0%–29.0%.

Why the margin moved: operating margin went +0.2 pp year on year while gross margin went +0.9 pp — the gain came mostly from the gross line: input costs and pricing.

Net profit Net profit is what survives every cost, interest and tax — the number EPS, dividends and book value all grow from.

Torrent Power Ltd earned ₹662 Cr of net profit in the Jun 26 quarter, −10.8% year on year. Full-year FY26 profit was ₹2,469 Cr. The 10-year compound rate is 10.6%. That is 8.1% of the quarter's revenue. The same quarter a year earlier earned ₹742 Cr.

Jun 26 profit was ₹662 Cr, −10.8% year on year. On the full year, FY26 printed ₹2,469 Cr (−19.3%), and the 10-year compound rate is 10.6%.

🚨 Why profit moved: revenue contributed +2.8% and the margin +0.0 pp — the quarter was revenue-led, with the margin roughly flat.

Pace comparison, last four quarters: profit +0.9% vs revenue +4.0%. Profit is growing slower than sales — costs are eating the growth before it reaches the bottom line.

Cash flow — the router The P&L says what was earned; the cash-flow statement says what actually arrived. Operating cash flow (CFO) against profit is the cleanest lie detector in the accounts.

Over the last 3 fiscal years 196% of Torrent Power Ltd's reported profit arrived as operating cash — the cash follows the profit. In FY26 that was ₹5,464 Cr of operating cash against ₹2,469 Cr of profit. After ₹7,653 Cr of capital spending, ₹−2,189 Cr was left as free cash.

FY26: operating cash of ₹5,464 Cr against reported profit of ₹2,469 Cr, leaving free cash of ₹−2,189 Cr after ₹7,653 Cr of capital spending. Across the last 3 fiscal years the conversion rate is 196% of profit.

Cash-flow readings here are annual — that is the resolution our series carries, so this section moves once a year.

Why conversion sits at 196%: the cash cycle tightened 14 days between FY21 and FY26 — cash that used to wait in the cycle now reaches the bank sooner.

Router verdict: the bigger cash user is investment — capital spending ran 3.4× depreciation over three years, so the next section's job is to check what that build-out is buying.

Where the cash goes Working capital is the cash tied up between paying suppliers and getting paid: debtor days (customers owe), inventory days (stock waits), and the cash conversion cycle (the whole loop, in days of sales).

Torrent Power Ltd's cash conversion cycle runs 29 days in FY26, down from 43 days in FY21. Capital spending ran ₹15,170 Cr over the last 3 years. At FY26 sales of ₹28,966 Cr each day of that cycle holds about ₹79.4 Cr, so roughly ₹2,301 Cr sits inside the business at any moment.

FY26: debtors at 29 days, inventory at 116 days — roughly 3.8 months of stock waiting to sell; that is where the cash sits while it waits — for a full cycle of 29 days, tighter than FY21's 43.

The full loop: cash goes out to suppliers and production on day 0; stock waits 116 days to sell; customers pay about 29 days after that; and suppliers themselves are paid at 430 days — netting out to the 29-day cycle.

In money terms: at FY26 sales of ₹28,966 Cr, each day of the cycle holds about ₹79.4 Cr — so the 29-day loop keeps roughly ₹2,301 Cr sitting inside the business at any moment.

On the investment side: capital spending of ₹15,170 Cr over the last 3 fiscal years against ₹4,488 Cr of depreciation — the company is building well ahead of wear-and-tear. Capital work-in-progress stands at ₹6,965 Cr (FY26) — capacity paid for but not yet earning.

The synthesis: the cash is going into capacity, not disappearing into the cycle — the question becomes whether the new capacity earns.

Return on capital Return on capital employed (ROCE) is the profit the whole business earns on all the money in it — equity and debt together. It is the single best test of whether growth creates value or just size.

Torrent Power Ltd earns a ROCE of 14% in FY26. That is up from a trough of 6% in FY14. A return-on-invested-capital spread against the cost of capital is not computable from what is held here. The wiring behind it is 8.5% net margin on 0.64× asset turns.

FY26 ROCE is 14%, recovered from a FY14 trough of 6% — the full ladder below shows the fall and the climb, undoctored.

Why the return is what it is — the wiring (FY26): 8.5% net margin × 0.64× asset turns × 2.36× balance-sheet leverage ≈ 12.8% on equity. Margin does its share; leverage is a meaningful part of the equation.

The quarterly return curves and the return-on-invested-capital overlay, which only the second data source carries, are not drawn on this page: its two data sources disagree by up to 34% on reported income across 15 comparable periods. A figure two sources cannot agree on is not drawn — the gap is a decision, not missing data.

Debt Debt-to-equity says how much of the business is funded by borrowings; interest cover says how many times operating profit pays the interest bill. Low and high, respectively, is the safe corner.

Torrent Power Ltd carries ₹13,971 Cr of borrowings against ₹19,075 Cr of equity in FY26, a debt-to-equity of 0.73. Operating profit covers the interest bill 6×. Over 5 years borrowings went from ₹7,817 Cr to ₹13,971 Cr. Capital spending ran ₹15,170 Cr across the last 3 of those years.

FY26: borrowings of ₹13,971 Cr against equity of ₹19,075 Cr — a debt-to-equity of 0.73. Operating profit covers the interest bill 6×. Over 5 years borrowings went from ₹7,817 Cr to ₹13,971 Cr while capital spending ran ₹15,170 Cr in just the last 3 — part of the build-out is riding on borrowed money.

The total-debt and debt-to-equity series, which only the second data source carries, are not drawn on this page: its two data sources disagree by up to 34% on reported income across 15 comparable periods. A figure two sources cannot agree on is not drawn — the gap is a decision, not missing data.

Ownership Who owns the stock, quarter by quarter: promoters (the controlling owners), foreign and domestic institutions, and the public. Steady accumulation by people close to the numbers is a signal; a quiet register is also an answer.

Domestic institutions added 3.2 points of Torrent Power Ltd over 8 quarters, the biggest move on the register. That takes domestic institutions to 22.7% of the company. Promoters moved −2.5 points over the same window, to 51.1%. The register is read on the four disclosed classes only; nothing is inferred between filings.

Why this happened. The distribution business (Gujarat, Maharashtra, UP, Karnataka) earns regulated returns under Multi-Year Tariff framework. New MYT regulations modernised the return methodology: pre-April 2025 assets now eligible for up to 1% incremental ROE via performance incentives (T&D loss reduction, smart meters, collection efficiency, network availability). AT&C losses at 2.5% are already best-in-class, but incremental opportunity exists across other levers. Regulatory assets Ahmedabad-Surat approximately Rs 3,000 Cr; carrying cost orders (~Rs 186 Cr in March 2026, Rs 41 Cr in Q3) are routine recurring features as the asset base grows — not one-off items. Unosugen power purchase cost cap Rs 171 Cr…

The register over the last two years — Domestic institutions: +3.2 points over 8 quarters to 22.7%; Promoters: −2.5 points over 8 quarters to 51.1%; Foreign institutions: +0.1 points over 8 quarters to 8.5%.

Why the register moved: domestic institutions drove it (+3.2 points), absorbed on the other side by promoters (−2.5 points) — steady accumulation by institutions reading the same numbers this page reads.

Safety line The Z-score estimates how far a company sits from balance-sheet distress — above roughly 3 is safe, below roughly 1.8 is the danger zone. It was built for manufacturers, so it is not applied to banks and lenders.

Torrent Power Ltd: the Z-score is not available for this stock, so we say so rather than invent one. It is a distance-to-distress estimate from the balance sheet, not a forecast of failure. The debt, cash-flow and return sections above carry the balance-sheet evidence this page does hold, and each of them states its own reporting date.

The safety line in one sentence: the Z-score is not available for this stock, so we say so rather than invent one.

Valuation P/E is the price of ₹1 of annual profit: how many rupees the market pays for each rupee the company earns in a year.

Torrent Power Ltd trades at 28.1× P/E, at the pricey end of its own range (84th percentile). Its long-run median P/E is 15.4×, measured across 10.6 years of weekly readings. This places the multiple against the stock’s own record, and says nothing about what the business is worth.

Today's P/E of 28.1× is at the pricey end of its own range (84th percentile), against a long-run median of 15.4× measured over 10.6 years of weekly readings. This is a comparison against the stock's own history — not a claim about what it is worth.

Why the multiple sits where it does: over the past year annual EPS moved −19.2% against a +2.4% price move — the price outran earnings, pushing the multiple UP its own range.

The price move, decomposed: over 5y, of the +22.1%/yr price move, ~+14.6%/yr came from earnings growth and ~+7.5 pp from the multiple (expanding); over 10y, of the +21.7%/yr price move, ~+11.7%/yr came from earnings growth and ~+10.0 pp from the multiple (expanding). The split is the honest approximate (price return minus earnings growth); it makes the rally itself visible instead of hiding it behind the percentile.

Put together: the multiple is full against its own past, so the story rests on the earnings line underneath it, not the multiple.

The PEG ratio and its quarterly curve, which only the second data source carries, are not drawn on this page: its two data sources disagree by up to 34% on reported income across 15 comparable periods. A figure two sources cannot agree on is not drawn — the gap is a decision, not missing data.

Stage: Deteriorating Every business sits somewhere on a fundamental arc, and this page names the spot before anything else. The last twelve quarters of revenue, profit and EPS growth — plus the return the business earns on its capital — are read as curves: Deteriorating (the curves are falling), Turning around (a trough has just formed and the last few quarters lift off it), Improving (the climb off the trough is sustained), Consistent (steadily positive with healthy returns), Topping out (still high but decelerating from the peak). When the curves genuinely disagree the read is Mixed; too little history is No read. CAGR (compound annual growth rate) is the smooth yearly pace that turns the starting value into the latest one — the fairest way to compare growth across different time spans. Read the columns together: if the 1-year number towers over the 10-year, recent growth is running hotter than the long-run trend. A dash means that window is not held, or the base year was a loss (where a growth rate is not meaningful).

Torrent Power Ltd reads as deteriorating on its fundamental arc. Deteriorating — profit and EPS growth are shrinking (profit growth −14.8% latest against +61.3% at its 12-quarter best), ROCE slipping at 14.0%. The read is built from 9 quarters across 4 curves, on partial evidence.

🚨 Why it matters: falling curves mean every cheap-looking ratio below needs a discount for direction.

Return readings here are annual, not quarterly — read as level and direction only; they can confirm the growth curves but never drive the stage on their own.

A partial read: at least one curve is short, or the returns curve is not the computed quarterly series — hold the stage word a little more loosely.

4-Factor Sector Score

44.7/100 — rank 12 of 20 in Power - Generation/Distribution · 82% evidence confidence

Torrent Power Ltd scores 44.7 out of 100 against the 20 companies it is compared with in Power - Generation/Distribution, ranking 12. Strong business, demanding price: keep it on the quality list, but require either earnings upgrades or valuation compression.

The four contributions add to the total exactly: 10.8 + 16.3 + 7 + 10.6 = 44.7. This is the SAME number shown on the sector comparison — it is computed once, for the whole peer set, and read here.

What would change it: The read weakens if profit growth turns negative or margin improvement reverses while sector-relative strength deteriorates.

Said versus delivered

What Torrent Power Ltd's management promised, set against what actually arrived — 4 tracked promises on the record. Read straight from the company’s own earnings calls. A promise that slipped stays on this page after it is met.

🚨 Renewable Capacity Addition - Substantial Shortfall vs Prior Guidance · 13 May 2026. In Aug 2025, management guided 500-700 MW of renewable capacity addition for the balance of FY26 (Q2 through Q4 FY26). The May 2026 call reveals renewable installed capacity grew from 1.8 GW at Q1 FY26 exit to only 2.0 GW at FY26 year-end, implying an addition of approximately 200 MW - roughly 60-70% below the prior guidance range. No explanation was offered in the latest call for this material execution gap, and an analyst on the call characterized FY26 as a lackluster year for capacity addition, which management did not dispute.

🚨 Renewable Capex for FY26 - Actual Fell Below Prior Guided Range · 13 May 2026. In Aug 2025, management gave a specific RE capex guidance range of INR7,000-8,000 crores for FY26 and indicated FY27 would be slightly higher than that range. The May 2026 call disclosed actual FY26 RE capex of approximately INR6,500 crores, which falls below the guided range by INR500-1,500 crores with no explanation provided. Management also declined to offer any specific FY27 RE capex guidance despite the prior call having set a clear directional target, representing a withdrawal of a previously stated commitment.

Parallel Licensing Decision - Imminent Outcome Implied vs No Update Nine Months Later · 13 May 2026. In Aug 2025, management stated that a MERC public hearing on parallel licensing for three distribution areas had concluded that very day and that MERC would announce its order within a couple of days, framing this as a near-term resolution on a meaningful growth catalyst. Nine months later in May 2026, management responded to a direct question on parallel licensing with no further development at this moment, offering no explanation for the prolonged absence of a decision on what was explicitly presented as an imminent outcome.

🚨 Capacity Commissioning Delay · 16 February 2026. In the August 2025 call, management projected commissioning 500 MW to 700 MW of new capacity during the remainder of FY 2026, which would have increased total installed capacity from 4.9 GW to roughly 5.4-5.6 GW. However, during the February 2026 call, management cited a baseline operating capacity of only 5.0 GW, indicating a significant shortfall and delay in the execution of its capacity addition pipeline for the fiscal year. Earlier call (Aug 2025): “For”. Later call (Feb 2026): “this acquisitions allows us to extend our without introduction of complexity and growth in sector. addition of operating capacity increase from 5 to 6.4 is philosophy of having stable cash return with minimal risk.”

Every quote above is taken word for word from the company’s own earnings calls.

Frequently asked questions