Add Torrent Power, target price Rs 501: HDFC Securities

HDFC Securities has add call on Torrent Power with a target price of Rs 501. The current market price of Torrent Power Ltd. is Rs 484.2. Time period given by analyst is one year when Torrent Power Ltd. price can reach defined target.

Torrent Power Ltd., incorporated in the year 2004, is a Mid Cap company (having a market cap of Rs 23290.69 Crore) operating in Power sector.

Torrent Power Ltd. key Products/Revenue Segments include Income From Power Supply, Other Operating Revenue and Traded Goods for the year ending 31-Mar-2021.



Financials
For the quarter ended 31-03-2022, the company reported a Consolidated Total Income of Rs 3840.59 Crore, up .19 % from last quarter Total Income of Rs 3833.14 Crore and up 23.23 % from last year same quarter Total Income of Rs 3116.54 Crore. Company reported net profit after tax of Rs -487.37 Crore in latest quarter.

Investment Rationale
Revenue is expected to grow 21% YoY to INR37.5bn and adjusted PAT is likely to grow 28.6% YoY to INR3.2bn, led by higher power demand. Overall generation, however, declined by 43.7% YoY as Torrent opted to procure power from external sources rather than generate it with unviable RLNG prices. Losses at Kalwa, Shilphata, and Mumbra are expected to abate.

Promoter/FII Holdings
Promoters held 53.57 per cent stake in the company as of 30-Jun-2022, while FIIs owned 6.79 per cent, DIIs 21.18 per cent.