Torrent Power Ltd. shares were trading over 5% higher on Thursday, September 3, following a significant upgrade from brokerage firm Investec. According to reports from CNBC TV18, the stock was trading at ₹1,306.80, representing a 4.64% gain for the day. The upgrade comes as Investec raised its price target to ₹1,515 per share and assigned a ''Buy'' rating to the power company. As per FactSet, the stock has an average rating of overweight and mean price target of ₹1,532.78, reflecting strong analyst confidence in the company's prospects.
Investec projects that Torrent Power is entering a 3-4 year earnings inflection phase, driven by strategic acquisitions and renewable energy expansion. As reported by CNBC TV18, the brokerage expects the 1.4 GW Nabha Power acquisition to add ₹11 billion to steady-state EBITDA from FY27. Additionally, the company's 4.2 GW renewable energy pipeline under execution is anticipated to materially expand its asset base and cash flows. The brokerage 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 company currently operates with an aggregate installed generation capacity of approximately 5,039 MWp, comprising 2,730 MW of gas-based capacity, 1,947 MWp of renewable capacity, and 362 MW of coal-based capacity.
According to Investec's analysis reported by CNBC TV18, 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 noted that the stock trades at an attractive valuation of 10 times FY28E EV/EBITDA and 2.6 times price-to-book value (P/BV). Despite the positive outlook, delays in project execution remain a key risk factor identified by the firm.
As reported by CNBC TV18, 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. The stock has been down around 1% so far this year, making the current 5% gain particularly significant for investors. The upgrade reflects growing confidence in the company's strategic positioning in India's expanding power sector, with the company maintaining its presence across power generation, transmission, distribution, and renewables segments through subsidiaries like Torrent Power Grid Limited and Nabha Power Limited.
