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INVESTMENT INSIGHTS

Check Before You Invest : Torrent Power Ltd

BSE: 532779 NSE: TORNTPOWER ISIN: INE813H01021
  |   Sector:  Power   |   Industry:  Power Generation/Distribution

Snapshot

Q.1 Which industry/sub-sector does Torrent Power Ltd belong to?
Torrent Power Ltd belongs to the Power sector, operating specifically within the Power Generation/Distribution segment.
Q.2 Is Torrent Power Ltd a good quality company?
Torrent Power Ltd is a good quality company, based on a consistently good 10 year financial track record.
Q.3 Is Torrent Power Ltd undervalued or overvalued?
Torrent Power Ltd appears Overvalued, as its key valuation ratios are above with their past averages.
Q.4 Is Torrent Power Ltd a good buy now?
Torrent Power Ltd is a neutral opportunity now, based on stable price trend analysis suggesting prices may move sideways. However, you need to check its quality and valuation before making a decision

Performance Analysis

Q.1 Revenue growth of Torrent Power Ltd?
Torrent Power Ltd revenue growth is 9.8% for FY-2025 , which is below its 5 year CAGR of 10.3% , indicating slower growth.
Q.2 Gross Profit margin of Torrent Power Ltd?
Torrent Power Ltd Gross profit margin which is the profit after deduction of direct costs, is 19% for FY-2025 , which is below its 5 year median of 21.2% , indicating decreasing margins.
Q.3 Operating Profit Margin of Torrent Power Ltd?
Torrent Power Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 19.87% for FY-2025 , which is below its 5 year median of 22.48% indicating decreasing margins.
Q.4 Net Profit Margin of Torrent Power Ltd?
Torrent Power Ltd Net Profit Margin is 13.01% for FY-2025 , is above with its 5 year median of 11.17%, indicating increasing margins.
Current Level Historic Median
Gross Profit Margin 19 21.2
Operating Profit Margin 19.87 22.48
Net Profit Margin 13.01 11.17
Q.5 Return on Asset of Torrent Power Ltd?
Torrent Power Ltd Return on Asset is 9.37%, which is above its 5 year historical median of 6.52%, indicating improved asset utilization efficiency.
Q.6 Return on Equity (ROE) of Torrent Power Ltd?
Torrent Power Ltd Return on equity is 19.33% for FY-2025 , which is above its historical median of 15.6%, indicating the business is making better use of its shareholders capital.
Q.7 Return on capital employed (ROCE) of Torrent Power Ltd?
Torrent Power Ltd Return on capital employed is 17.44% for FY-2025 , which is above its estimated weighted average cost of capital(WACC) 11.25%, indicating value creation.
Q.8 Cash conversion cycle of Torrent Power Ltd?
Torrent Power Ltd Cash conversion cycle is 13 days, above its historical median of 13 days, indicating deteriorated working capital management. However, you need to compare this with its peers in the industry.
Current Level Historic Median
Asset Turnover 0.72 0.72
ROE 19.33 15.6
ROCE 17.44 15.69
Cash Conversion Cycle 13 days 13 days
Q.9 Debt to Equity ratio of Torrent Power Ltd?
Torrent Power Ltd Debt-to-Equity ratio is 0.36 , which is lower with the industry average of 1.05 , indicating lower debt levels in the industry.
Q.10 Debt to cash flow from operations of Torrent Power Ltd?
Torrent Power Ltd Debt to cash flow from operations is 1.49 , which is at a healthy level, indicating the business is able to service its debt comfortably.

Ownership & governance

Q.1 Promoter shareholding and pledge status of Torrent Power Ltd?
Promoters hold 51.09% of the Torrent Power Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

Q.1 Revenue growth of Torrent Power Ltd vs industry peers?
Torrent Power Ltd revenue CAGR is 10.27% , compared to the industry median CAGR of 5.38% , indicating faster growth and gaining its market share.
Profit Metrics
Current Level Industry Median
Revenue 21,912.6 14,561
Gross Profit 4,163.5 4,581.3
Operating Profit 4,333 4,386.5
Net Profit 2,851 2,749.5
Operating Efficiency
Current Level Industry Median
Asset Turnover 0.72 0.48
ROE 19.33 12.42
ROCE 17.44 12.26
Cash Conversion Cycle (days) 12.92 98

Valuation & price assessment

Q.1 Stock return of Torrent Power Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of 20.6% based on the current price.
Q.2 What return has the stock given over the last decade?
9Y 5Y 3Y 1Y
Share Price 20.6% 30% 39.9% -5.5%
Q.3 Valuation ratios of Torrent Power Ltd vs historical?
The current P/E is higher that its historical median.
Q.4 How do the current valuation ratios measure up against the historic numbers and the current industry numbers?
Valuation Ratios Current Historic Median Industry Median
Price to Earnings 22.99 12.55 32.46
Price to Book 3.84 1.75 1.75
Price to Sales 3.37 1.32 6.05
EV to EBITDA 15.64 6.57 12.85

Check more companies

1. JSW Energy
2. NTPC Green Energy
3. NHPC
4. Torrent Power
5. Neyveli Lignite
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