Torrent Power Ltd. reported a 9% year-on-year fall in net profit for the second quarter of this financial year. The energy and power company recorded a consolidated net profit of Rs 495.72 crore for the quarter ended September, compared to Rs 542.55 crore in the same quarter of the previous fiscal year, according to its stock exchange notification.
Revenue increased by 3.1% year-on-year for the three months ended September, reaching Rs 7,175.81 crore. Operating income, or earnings before interest, taxes, depreciation, and amortisation, fell 1.2% year-on-year to Rs 1,207.31 crore. The Ebitda margin contracted by 200 basis points to 16.8% from 18.8% in the same period the previous year.
The profit fell due to an increase in contribution from licensed distribution businesses offset by "lower contribution from thermal generation mainly on account of reduced sale of merchant power (including sale of LNG) due to lower electricity demand in the current quarter on account of extended and heavy monsoons against comparable quarters last year."
The company also added that lower contributions from renewable businesses due to lower PLF on account of inclement weather conditions and partial commissioning of solar projects under the stabilisation period also impacted the profit made during the period.
The company also added that the increase in finance and depreciation costs was due to capex and commissioning of additional renewable generation capacity.
The shares of Torrent Power were trading higher on Monday. The shares rose as much as 2.01% during the day to Rs 1,692 apiece on the NSE. It closed 0.82% lower at Rs 1,645.10 apiece. This compares to a 0.70% advance in the NSE Nifty 50 Index. It has risen 100.52% in the last 12 months and 74.56% year-to-date.
Out of 10 analysts tracking the company, four maintain a 'buy' rating, two recommend a 'hold,' and four suggest 'sell,' according to Bloomberg data. The average 12-month consensus price target implies a downside of 9.5%.
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