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The market expects much less from Torrent Power than it has delivered before.
At today’s share price, buyers are assuming Torrent Power grows about 0% a year, forever. Over the last ten years it actually grew about 8% a year. That is a big step down from its own record — in other words, that it stops growing altogether. Either the market can see a problem that the published accounts do not show yet, or it is expecting a slowdown that has not happened.
- How it is valued: Discounted cash flow.
- What the price assumes: 0% growth, against 8% the model takes from its own record.
- Ten-year record: Between FY2018 and FY2026, Torrent Power's revenue went from ₹11,512 crore to ₹28,966 crore — it compounded at about 12% a year over 8 years.
- Biggest swing factor: Distribution growth. Main risk: Regulation.
01Ahmedabad's power company
Torrent Power, part of Ahmedabad's Torrent group, distributes electricity in Ahmedabad, Gandhinagar, Surat, Dahej, Bhiwandi, Agra and Dadra & Nagar Haveli, Daman and Diu.
It also runs gas-fired and renewable power plants and is investing in pumped storage and green hydrogen.
02What the market is assuming
Work backwards from today's share price and you can see what buyers are quietly taking for granted. Here is the growth that price implies for Torrent Power, next to what the model assumes from the company's own record.
The further apart these two numbers are, the bigger the bet a buyer at today's price is making.
03Torrent Power's record, in plain numbers
Between FY2018 and FY2026, Torrent Power's revenue went from ₹11,512 crore to ₹28,966 crore — it compounded at about 12% a year over 8 years. Net profit grew from ₹952 crore to ₹2,469 crore, about 13% a year — roughly in step with revenue. In FY2026 it kept 8.5% of revenue as net profit — against a low of 3.2% in FY2022 and a high of 10.6% in FY2021. Revenue slipped 0.7% in the latest year, well behind its own long-run pace.
Revenue and earnings per share in ₹, return on equity and leverage as ratios — all from the filed statements.
Revenue and net profit by year (₹ crore)
| Year | Revenue | Net profit | Margin |
|---|---|---|---|
| FY2018 | 11,512 | 952 | 8.3% |
| FY2019 | 13,151 | 904 | 6.9% |
| FY2020 | 13,641 | 1,179 | 8.6% |
| FY2021 | 12,173 | 1,296 | 10.6% |
| FY2022 | 14,258 | 459 | 3.2% |
| FY2023 | 25,694 | 2,165 | 8.4% |
| FY2024 | 27,183 | 1,896 | 7.0% |
| FY2025 | 29,165 | 3,059 | 10.5% |
| FY2026 | 28,966 | 2,469 | 8.5% |
04How Torrent Power gets valued — and why
Discounted cash flowThis business is valued on the cash it is expected to generate, discounted back at its cost of capital — with growth taken from its own ten-year record rather than from guidance.
05What decides Torrent Power's value
Distribution growth
More customers and demand in its licence areas.
Renewable capacity
New solar and wind projects add earnings.
Gas plant utilisation
LNG prices affect gas-plant profitability.
Pumped storage
A new business supporting renewables.
06What could go wrong
- Regulation. Tariff orders set distribution returns.
- LNG prices. Expensive gas hurts plant economics.
- Execution. Large projects can slip.
07What the full Torrent Power valuation shows
Sign in free to see the complete Torrent Power valuation
- ✓Fair value per share — from a ten-year discounted cash flow, every step shown
- ✓The Workbench — change revenue growth, the discount rate or terminal growth and watch Torrent Power's value move
- ✓Bull, base and bear cases — and exactly which assumptions move between them
- ✓Peer comparison — against Tata Power, NTPC and JSW Energy
- ✓Downloadable report — the full write-up, yours to keep
08Questions people ask about Torrent Power
Where does Torrent Power distribute electricity?
Ahmedabad, Gandhinagar, Surat, Dahej, Bhiwandi, Agra and Dadra & Nagar Haveli, Daman and Diu.
Is Torrent Power related to Torrent Pharma?
Both belong to Ahmedabad's Torrent group.
What is pumped storage?
Storing energy by pumping water uphill and releasing it to generate power.
Is Torrent Power overvalued?
At ₹1,221 the market is pricing in roughly 0% sustained growth, against the ~8% its own record supports. That is less than it has delivered — on these numbers the market is asking the business for less than its own record, which usually means it doubts the record repeats.
What is the intrinsic value of Torrent Power?
It is computed from the filed financial statements using the method that fits this business (discounted cash flow), with every assumption shown alongside the result. The per-share figure and the full working are in the report.
How much debt does Torrent Power carry?
Debt to equity stands at 0.64, down from 0.85 at the start of the period — the balance sheet is a core input to the cost of capital used here.