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Informist, Monday, Feb. 16, 2026

 

--Torrent Power: Nabha Power's power purchase pact in force 13 more years

--CONTEXT: Torrent Power mgmt's comments on Nabha Power acquisition

--Torrent Power: Nabha Power has purchase pact with Punjab govt utilities

--Torrent Power: Nabha Power operating cash flow seen at INR 15 bln FY26

 

By Narayana Krishna and Gopika Balasubramanium

 

HYDERABAD/MUMBAI – Torrent Power Ltd. Monday said Nabha Power Ltd., which the Ahmedabad-headquartered company is acquiring from a wholly-owned subsidiary of engineering giant Larsen & Toubro Ltd., has power purchase agreements with state-owned distribution companies in Punjab that will be in force for 13 more years. So, the company does not anticipate any challenges in generating cash flows.

 

"The acquisition allows us to extend our footprint without introduction of execution complexity and accelerate our growth in the thermal sector," the Torrent Power management told analysts on a conference call. "With this addition, our operating capacity increases from 5 gigawatts to 6.4 gigawatts and is aligned with our philosophy of having stable cash flows and effective equity returns with minimum risk."

 

On Monday, Torrent Power signed a definitive agreement with Larsen & Toubro through its subsidiary L&T Power Development Ltd. to buy Nabha Power. Nabha Power operates a 1.4-gigawatt supercritical coal-fired thermal power plant at Rajpura in Patiala, Punjab. The plant had signed 25-year power purchase agreements, of which 12 years have been completed. The Torrent Power management expressed confidence that the agreements with Punjab power utilities would be extended in the future.

 

The Torrent Power management said Nabha Power is expected to generate a cash flow of INR 15 billion in the financial year 2025-26 (Apr-Mar). The deal includes INR 36.61 billion of equity, INR 4.95 billion of promoter loan, and net debt of INR 27.33 billion, taking the total enterprise value of Nabha Power to INR 68.89 billion. The Torrent Power management said the acquisition will be carried out through a combination of cash and debt.

 

According to reports, as of Dec. 31, Torrent Power had a consolidated debt of nearly INR 102 billion while net debt was at INR 83.5 billion. The company recently raised INR 70 billion through non-convertible debentures to fund expansion plans. Torrent Power said its borrowing cost currently is 8.5%.

 

For the December quarter, Torrent Power reported a net profit of INR 6.43 billion on a revenues of INR 67.78 billion. Monday, its shares ended at INR 1,471.40  on the National Stock Exchange, up 1.6% from its previous close.  End

 

Edited by Rajeev Pai

 

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