Torrent Power Ltd. has received a target price hike from global brokerage Jefferies, backed by rising renewable energy capacity, steady return on equity (ROE) and low Plant Load Factors (PLF)
Jefferies has raised Torrent Power's target price from Rs 1,700 to Rs 1,780. The brokerage said that it expects gas PLFs to remain low.
On the renewable energy front, capacity is estimated to grow sharply by fiscal year 2030. Jefferies expects to capacity to increase by at least 3X of the existing capacity.
Moreover, the power company is expected to maintain a steady return on equity of 12-13% every year from financial year 2026 to financial year 2030.
However, the brokerage flagged that transmission infrastructure availability is leading to delays in commissioning timelines, primarily for renewable power projects.
On the operational front, earnings before interest, taxes, depreciation and amortisation (Ebitda) are expected to at a 13% compound annual growth rate (CAGR) between FY 2026 and FY 2030, driven primarily by its renewable energy business, where EBITDA is projected to grow at a 36% CAGR over the same period.
Torrent Power Q1FY27 Results
Torrent Power posted a weaker first-quarter earnings performance, with consolidated net profit falling 13% from a year earlier, even as the utility delivered modest growth in revenue and a slight improvement in operating profitability.
The company's consolidated profit fell to Rs 639 crore in the quarter ended June, compared with Rs 731 crore in the corresponding period last year.
The decline in earnings came despite steady growth in the top line and a marginal improvement in profitability at the operating level.
Revenue from operations rose 2.8% year-on-year to Rs 8,124 crore from Rs 7,906 crore a year earlier. Earnings before interest, tax, depreciation and amortisation (EBITDA) increased 3.7% to Rs 1,538 crore, compared with Rs 1,483 crore in the year-ago period. Ebitda margin also improved marginally to 18.9% from 18.8%.
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