Results: Torrent Power Limited Beat Earnings Expectations And Analysts Now Have New Forecasts

Last week, you might have seen that Torrent Power Limited (NSE:TORNTPOWER) released its third-quarter result to the market. The early response was not positive, with shares down 5.4% to ₹1,375 in the past week. The result was positive overall - although revenues of ₹65b were in line with what the analysts predicted, Torrent Power surprised by delivering a statutory profit of ₹9.76 per share, modestly greater than expected. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

View our latest analysis for Torrent Power

Following the latest results, Torrent Power's nine analysts are now forecasting revenues of ₹333.0b in 2026. This would be a solid 14% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to soar 22% to ₹57.06. Before this earnings report, the analysts had been forecasting revenues of ₹327.0b and earnings per share (EPS) of ₹59.10 in 2026. The analysts seem to have become a little more negative on the business after the latest results, given the small dip in their earnings per share numbers for next year.

It might be a surprise to learn that the consensus price target was broadly unchanged at ₹1,445, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Torrent Power, with the most bullish analyst valuing it at ₹2,026 and the most bearish at ₹1,075 per share. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that Torrent Power's revenue growth is expected to slow, with the forecast 11% annualised growth rate until the end of 2026 being well below the historical 22% p.a. growth over the last five years. Compare this to the 11 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 11% per year. So it's pretty clear that, while Torrent Power's revenue growth is expected to slow, it's expected to grow roughly in line with the industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple Torrent Power analysts - going out to 2027, and you can see them free on our platform here.

Even so, be aware that Torrent Power is showing 2 warning signs in our investment analysis , you should know about...

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.