Investec said Torrent Power is entering a 3-4 year earnings inflection phase, driven by the acquisition of 1.4 GW Nabha Power and an accelerated renewable energy (RES) build-out.
The brokerage expects Nabha Power to add ₹11 billion to steady-state EBITDA from FY27. Meanwhile, Torrent Power’s 4.2 GW renewable energy pipeline under execution is expected to materially expand its asset base and cash flows.
Investec estimates the company could generate ₹138 billion in operating cash flow over FY27-FY28, supported by the expansion in its renewable energy portfolio and the Nabha acquisition.
The brokerage said the stock trades at an attractive valuation of 10 times FY28E EV/EBITDA and 2.6 times price-to-book value (P/BV).
However, delays in project execution remain a key risk, Investec said.
Of the 12 analysts covering Torrent Power, six have a ‘Buy’ rating, four have a ‘Hold’ rating and two have a ‘Sell’ call on the stock.Shares of Torrent Power were trading 4.64% higher at ₹1,306.80 on Thursday. The stock is down around 1% so far this year.
