Reduce Torrent Power, target price Rs 470: ICICI Securities

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ICICI Securities has reduce call on Torrent Power with a target price of Rs 470. The current market price of Torrent Power Ltd. is Rs 564.95. 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 27282.21 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 31-12-2021, the company reported a Consolidated Total Income of Rs 3833.14 Crore, up 4.06 % from last quarter Total Income of Rs 3683.69 Crore and up 28.19 % from last year same quarter Total Income of Rs 2990.11 Crore. Company reported net profit after tax of Rs 369.45 Crore in latest quarter.

Investment Rationale
The brokerage upgrades Torrent Power from Sell to REDUCE due to stock price movement, but maintains target price of Rs470/share. The stock is currently trading at FY24E consolidated P/E of 17.6x and P/B of 2.1x. Key upside risks: 1) Higher utilisation of plants and lower gas prices, 2) new license area wins, and 3) faster than estimated renewable capacity addition.


Promoter/FII Holdings
Promoters held 53.57 per cent stake in the company as of 31-Mar-2022, while FIIs owned 6.86 per cent, DIIs 20.91 per cent.

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