Check Before You Invest : Reliance Power Ltd

Snapshot

Q.1 Which industry/sub-sector does Reliance Power Ltd belong to?

Reliance Power Ltd belongs to the Power sector, operating specifically within the Power Generation/Distribution segment.

Q.2 Is Reliance Power Ltd a good quality company?

Reliance Power Ltd is a average quality company, based on a somewhat consistent 10-year financial track record.

Q.3 Is Reliance Power Ltd undervalued or overvalued?

Reliance Power Ltd appears Undervalued, as its key valuation ratios are below with their past averages.

Q.4 Is Reliance Power Ltd a good buy now?

Reliance Power Ltd is a good buy now, based on strong price trend analysis suggesting prices may rise. However, you need to check its quality and valuation before making a decision

Performance Analysis

Q.1 Revenue growth of Reliance Power Ltd?

Reliance Power Ltd revenue growth is -3.9% for FY-2025, which is below its 5-year CAGR of 0.05%, indicating slower growth.

Q.2 Return on capital employed (ROCE) of Reliance Power Ltd?

Reliance Power Ltd Return on capital employed is 16.81% for FY-2025, which is above its 5-year historical median of 6.57%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 13.5%, indicating value creation.

Q.3 Return on Asset of Reliance Power Ltd?

Reliance Power Ltd Return on Asset is 6.91%, which is above its 5-year historical median of -0.7%, indicating improved asset utilization efficiency.

Q.4 Return on Equity (ROE) of Reliance Power Ltd?

Reliance Power Ltd Return on equity is 22.53% for FY-2025, which is above its 5-year historical median of -2.97%, indicating the business is making better use of its shareholders capital.

Q.5 Cash conversion cycle of Reliance Power Ltd?

Reliance Power Ltd Cash conversion cycle is 98 days, below its 5-year historical median of 120 days, indicating improved working capital management. However, you need to compare this with its peers in the industry.

	Current Level	5-year Historic Median
Asset Turnover	0.18	0.15
ROE	22.53	-2.97
ROCE	16.81	6.57
Cash Conversion Cycle	98 days	120 days

Q.6 Gross Profit margin of Reliance Power Ltd?

Reliance Power Ltd Gross profit margin which is the profit after deduction of direct costs, is 9.6% for FY-2025, which is above its 5-year median of 2.6%, indicating increasing margins.

Q.7 Operating Profit Margin of Reliance Power Ltd?

Reliance Power Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 21.05% for FY-2025, which is below its 5-year median of 25.57% indicating decreasing margins.

Q.8 Net Profit Margin of Reliance Power Ltd?

Reliance Power Ltd Net Profit Margin is 38.87% for FY-2025, is above with its 5-year median of -4.56%, indicating increasing margins.

	Current Level	5-year Historic Median
Gross Profit Margin	9.6	2.6
Operating Profit Margin	21.05	25.57
Net Profit Margin	38.87	-4.56

Q.9 Debt to Equity ratio of Reliance Power Ltd?

Reliance Power Ltd Debt-to-Equity ratio is 1.04, which is above with the industry average of 0.39, indicating higher debt levels in the industry.

Q.10 Debt to cash flow from operations of Reliance Power Ltd?

Reliance Power Ltd Debt to cash flow from operations is 7.82, which is at a unhealthy level.

Ownership & governance

Q.1 Promoter shareholding and pledge status of Reliance Power Ltd?

Promoters hold 24.98% of the Reliance Power Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

Q.1 Revenue growth of Reliance Power Ltd vs industry peers?

Reliance Power Ltd revenue CAGR is 0.05%, compared to the industry median CAGR of 0.59%, indicating stable growth and maintaining its market share.

Profit Metrics

	Current Level	5-year Industry Median
Revenue Growth	-3.9	0.6
Gross Profit Growth	0	-0.1
Operating Profit Growth	34.7	NAN
Net Profit Growth	0	-3.2

Operating Efficiency

	Current Level	5-year Industry Median
Asset Turnover	0.18	0.13
ROE	22.53	2.44
ROCE	16.81	4.39
Cash Conversion Cycle (days)	98.5	63

Valuation & price assessment

Q.1 Stock return of Reliance Power Ltd over the last decade?

Over the last 9 year(s), the stock has delivered a CAGR of -5.7% based on the current price.

Q.2 What return has the stock given over the last decade?

	9Y	5Y	3Y	1Y
Share Price CAGR	-5.7%	40.1%	34.1%	-28.6%

Q.3 Valuation ratios of Reliance Power Ltd vs historical?

The current P/E is higher that its historical median.

Q.4 How do the current valuation ratios compare with 5-year historical median and industry numbers?

Valuation Ratios	Current	5-year Historic Median	5-year Industry Median
Price to Earnings	41.96	16.99	27.19
Price to Book	0.79	0.81	1.80
Price to Sales	1.54	1.41	6.78
EV to EBITDA	9.14	11.98	13.53

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