Torrent Power Limited (NSE: TORNTPOWER) Q1 2026 Earnings Call dated Aug. 05, 2025
Corporate Participants:
Unidentified Speaker
Saurabh Mashruwala — Executive Director, Chief Financial Officer
Analysts:
Unidentified Participant
Mohit Kumar — Analyst
Satyadeep Jain — Analyst
Sumit Kishore — Analyst
Nikhil Abhyankar — Analyst
Presentation:
Unidentified Speaker
IT Sa. Sam. SA sa. IT SA Sam. SA. IT.
Unidentified Speaker
SA.
Unidentified Speaker
Foreign.
Unidentified Speaker
Ladies and gentlemen, you have joined the Torrent Power Limited Earnings Conference call. Please stay connected, the call will begin shortly. I repeat, you have joined the Torrent Power Ltd. Earnings conference call. Please stay connected, the call will begin shortly.
Unidentified Speaker
SA.
operator
Ladies and gentlemen, good day and welcome to Torrent Power Ltd. Q1FY26 earnings conference call. As a reminder, all participant lines will be in the listen only mode and there will be an opportun for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing Star then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Sourab Mashirwala, Executive Director and CFO. Thank you. And over to you sir.
Saurabh Mashruwala — Executive Director, Chief Financial Officer
Thank you so much. Good evening to all of you and thank you for joining Torrent powering call for Q1FY26. First I will take you through the performance of the quarter after which phone lines will be open for question and answer session. We’ll explain the performance of the company at PBD level. First, reported PBD for the quarter stood at 985 crores as compared to 1,315 crores in corresponding quarter last year. Decrease of 329 crore Decrease by 329 crores A reduction of 25% or reported business days PD for the quarter include non recurring loss of 59 crores on account of non cash adjustment due to foreign exchange fluctuations.
PBD for the corresponding quarter of last year include non recurring credit of 102 crores on account of receipt of favorable tariff order of our license distribution area which primarily includes carrying cost allowances. As you said for about non recurring items, the adjusted PBD for the quarter stood at 144 crores as compared to 1,213 crores in comparable quarter of last year which is lower by about 169 crores. A reduction of 14%. Company’s underlying business remained resilient. However company quarter was mainly impacted by lower merchant gain partially offset by improvement in the other businesses. On account of positive operational parameters, company seems well positioned to navigate cyclical variations supported by the divisive business operations.
The business wise key factors contributing to the performance are as follows. There are four factors which I will explain to you. First, reduction in gain from sale of merchant power as well as LNG of 5333 crores. Demand of the power remains subdued due to early onset of the monsoon. Further, LNG price remain elevated impacting the sales of merchant gas with capacity of 1.5 gigawatt. Overall PLF for the thermal generation deteriorated from 60% in Q1 of FY25 to 39% in Q1 of FY26 due to lower long long term as well as merchant sales. Second, improved contribution from distribution business by 82 crores mainly on account of two factors.
First, improvement in operational parameters like lower distribution losses and higher collection efficiency efficiencies. Second, additionally contribution from the license business was also supported by the increase in ROE as well as ROCE on account of capitalization of assets as well as higher rate of returns on equity as well as new tariff regulations. Third, contributions of renewable improved by 31 crores on account of mainly on account of interest income on delayed payment under LTA scheme. Higher PLF partially offset by lower contracts from a new solar project up 300 megawatt of TPLD as well as MSKBY. Fourth, lower interest expenses of 547 crores on account of prepayment of debt from the QIP proceeds due to qip Proceed.
This completes the explanation of the financial performance during the quarter. Moving on, we’ll now give the brief update on the pipeline projects during the quarter Company successfully secured a contract under CK 80 tying up needed make out merchant capacity at a competitive rate of 3.97 rupees per unit. With progressive commissioning of the 16 megawatt MSC DCL project aggregate installed sensation capacity the company stood at 4.9 gigawatt as on 30 June 25 comprising of 2.7 gigawatt of gas, 1.8 gigawatt of renewal capacity and 362 megawatt of coal based capacity. Various pipan project gather at the end at the end of the quarter includes 3.1g out of renewable projects, 3g of storage projects, 2 transmission project of C as well as solar.
Further details on the pipeline project have been summarized on our latest invisible presentation available on the website. I would now request coordinator to open the line for Q and A session. We wish everybody to stay safe and Ali thank you so much. Handing over to the operator.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press Star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles the first question is from the line of Mohit Kumar from ICICI Securities. Please go ahead.
Mohit Kumar
Hi.
Mohit Kumar
Good evening sir and thanks for the opportunity.
Mohit Kumar
My first question is of course this.
Mohit Kumar
Quarter we are impacted by the lower merchant prices and lower off tech for the gas based power plant.
Mohit Kumar
Is it fair to say that we.
Mohit Kumar
Are guaranteed certain amount of payment for that till October under the existing PPA so the Q2 should be better compared to last year. Is that a fair assumption?
Saurabh Mashruwala
So see the quarter has been impacted mainly by the merchant sales because of the early onset of monsoon as well as elevated gas price. So our NVBN tender which is surplus number of 15th of March and will be continued till October 15th of October it could be split into two quarters. So whatever supply have not happened under NDBS tender will going to happen going forward in Q2. Possibly something may feel over the Q3 also.
Mohit Kumar
My second question is on the RE portfolio is it possible to spell out.
Mohit Kumar
The CapEx which you’ve done for the Q1?
Saurabh Mashruwala
Q1? The Q1 CapEx is about 350 crores.
Mohit Kumar
And how does progress in the balance here?
Saurabh Mashruwala
Balance there is a plan we have planned. So we have planned to have about 100 to 700 megawatt capital coming in. So progressively we’ll incur the CapEx for the RE portfolios.
Mohit Kumar
Any board number for fiscal year 26 or 27? Sir, is it possible to share. Sorry, is it possible to share the.
Mohit Kumar
Broad capex number for expected number for.
Mohit Kumar
F26 and F27 or RE?
Unidentified Speaker
So for 26 it should be around 7,000 to 8,000 crores for this year and slightly higher number for next year.
Mohit Kumar
Understood sir, thank you, that’s very helpful. Thank you.
operator
Thank you. The next question is from the line of Satyadeep Jain from Ambit Capital. Please go ahead.
Satyadeep Jain
Hi. Thank you. First the merchant EBITDA for the quarter just want to understand the PLS was low but under the NBVN tender you have minimum guaranteed offtake. So was there some EBITDA contribution this quarter from TAKE or say where? Even if NBVN doesn’t lift you are guaranteed fixed cost on whatever is not listed. Just wanted to understand was there some contribution from there in this quarter?
Saurabh Mashruwala
The contribution from merchant Will is there definitely because of the NVB they have lifted some portion but it will be whatever is a guaranteed thing is going to happen next quarter as well as something spillover will happen in the Q3 also minimum quant guarantee quantity will is going to happen.
Satyadeep Jain
I’m just trying to understand there will be some Guaranteed offtake every day. I think last time you trying to understand what I understood was if they don’t lift the minimum guaranteed offtake which would be 2,300 mu, you would. They will not pay you the entire tariff but you will be guaranteed at least a fixed cost. So just.
Unidentified Speaker
I think what you’re trying to understand is that this quarter what was the minimum guaranteed offtake and correspondingly what was the realization from that. So basically this tender is for till October, right? So the guaranteed offtake they have to take is till October. Now it is not split into everyday demand every. So if. Let’s say on a particular day, if the demand is not there, they may not. They may not commission or they may not ask you to provide power. It can spill over to different day. So basically what you are saying is that there is.
There was some. Some offtake under the NBB tender and expectation is that minimum guaranteed offtake will be taken by NVN going forward progressively. There could be a. There is a possibility that some guaranteed offtake may also get spilled over from.
Unidentified Speaker
October to the next quarter also.
Satyadeep Jain
And during those crunch days there’s a minimum TLF of 50% during non peak and 100%. So accounting wise I thought whenever in this quarter also would have some fixed cost recovery. No, no.
Unidentified Speaker
We.
Unidentified Speaker
We book.
Unidentified Speaker
We book based on the sales which happens, right? And what you are saying should be true. In case once the period expires and they are not uptake the minimum guarantee then we will have to see whether we want to account that for not. But as of now, whatever we have booked is based on the offtake which they have done.
Unidentified Speaker
Based on the actual offset we have done.
Unidentified Speaker
Okay.
Unidentified Speaker
Number but based on the actual actual uptake we have booked the revenues and contributions.
Satyadeep Jain
Fair enough. Just one thing I noticed in the presentation some merchant wind capacity you had is it seems like you transitioned that into SECI 18. What is the rationale? Because earlier you were thinking of keeping some merchant wind in the portfolio. It seems to have been toned down. Is that true? And what is the rationale for that?
Saurabh Mashruwala
So we have two merchant projects in fact developing. So we got this Seiki 18 tender. So we have shipped the tariff was 3 rupees 97 paisa which is quite good I would say. So we have. We have shifted this merchant capital of 6018 tenders. So that is what the object because tariff was good. 3 rupees 97 paisa in the 6018 tenders. So better to switch over this merchant capital sikhi and contract lock in at better tariff and we will develop further merchant capacity going forward. Also.
Satyadeep Jain
Just one quick question. If I can squeeze another one on the parallel licensing. I think there is some news report indicating some Capex opportunity in Nagpur. I think there is some hearing. Just want to understand these steps in that process right now. And I think the news reports indicate maybe fat losses for the first four years. Just wanted to understand why is that. I’m not sure if it was misquoted or something. Why if that is why should there be PAC losses in the first four years? Maybe can you talk about this opportunity, these steps and I’m not sure whatever the media reports are.
Just wanted to understand your thoughts there.
Saurabh Mashruwala
So we can’t comment as a media report. But the fact of the matter is that today. But today is the public hearing happen in Mara in Mumbai organized by the macd. So that happened today. Now they have reserved the orders now. So it will be completely going to be announced in couple of days I would say. And then we will come to know the exist status about the parallel licensing. The public hearing took place today in. In Mumbai.
Satyadeep Jain
The public hearing will be announced in two days. What are the steps after that?
Saurabh Mashruwala
Couple of. Couple of days. Not two days couple of days. Then they will reserve them whether to allocate to give the circles the torrent tower or not based on the public hearing.
Saurabh Mashruwala
Okay. So within few. Within a couple of days or so we should find out. You see.
Saurabh Mashruwala
Yeah.
Saurabh Mashruwala
That is what we expect to. MSC Regulatory commission will announce the result.
Satyadeep Jain
And this speaks to all the three, right?
Saurabh Mashruwala
Yes, all the three areas.
Satyadeep Jain
Thank you so much.
operator
Thank you. The next question is from the line of Sumit Kishore from Access Capital. Please go ahead.
Sumit Kishore
Thank you. Could you give us a sense of what is the total sale of Merchant units in Q1 and what was your merchant contribution from gas based power plants in the first quarter of the year? Our sense last year was that in Q1 last year you had realized almost 6 billion rupees of merchant gains.
Saurabh Mashruwala
So it was a merchant sale of about 714 MU’s this quarter.
Saurabh Mashruwala
714.
Saurabh Mashruwala
714 MU’s including the NVV and tender also.
Saurabh Mashruwala
Okay.
Saurabh Mashruwala
Contribution contribution was about 327 crores.
Sumit Kishore
Got it. This is very clear. The second question is. Sorry.
Saurabh Mashruwala
Yeah. No you go ahead.
Sumit Kishore
Yeah. The second question is I think you mentioned to a previous participant that Q1 capex was 3.5 billion rupees only. I thought that your.
Sumit Kishore
Your 350 crores for the renewal only. Overall capex is about 850 crores. But the 350. 350.
Unidentified Speaker
So okay, company level capex was 850 crore out of his renewable was 350.
Sumit Kishore
Okay, just to understand given you know the numbers that we are looking at on a annual basis are north of 70, 80 billion rupees. So is there any reason why Q1 capex in renewable is so low or you know or how should we read this sort of number seems quite low.
Saurabh Mashruwala
Yeah.
Saurabh Mashruwala
It will be ramp up in the Q2 H2 I would say significantly as compared with H1.
Saurabh Mashruwala
Okay. And in addition to the 2 gigawatt Maharashtra PSP. Now the total PSP that you are showing is 3 gigawatt. So.
Saurabh Mashruwala
2 gigawatt is a tied up with MSC this year and 1 gigawatt we are planning is a on a merchant basis which will be tied up at some point of time. As of now we are developing single capacity PSV capacity.
Sumit Kishore
Okay, so that one gigawatt merchant is at the same location.
Saurabh Mashruwala
Yeah, same location. So because location is a 3 gigawatt capacity out of it we have to add MSC DC.
Sumit Kishore
Got it.
Sumit Kishore
Got it.
Sumit Kishore
Those are my questions.
Sumit Kishore
Thank you.
Saurabh Mashruwala
Thank you.
operator
Thank you. The next question is from the line of suya chain from NDTV. Prophet, please go ahead. Mr. Suresh, are you there? Sir, as there is no response from the participant we move to the next one. The next one. The next participant is Chetan Jain from Avendes Park. Please go ahead.
Unidentified Participant
Thank you.
Unidentified Participant
Sir, just to follow up on the previous question. You said your EBITDA contribution from merchants was around 327 crores. Does it include the LNG sale also?
Unidentified Participant
LNG sale?
Saurabh Mashruwala
So basically when we say merchant it includes LNG and annual sales also.
Saurabh Mashruwala
Both.
Saurabh Mashruwala
Both.
Unidentified Participant
Okay sir, any number. What is the comparable number for same for previous quarter? Previous year?
Saurabh Mashruwala
It’s basically we don’t give the breakup. It’s interchangeable between depending upon the opportunities.
Saurabh Mashruwala
Comparable number for first quarter FY25 for the same 327 crores.
Saurabh Mashruwala
Yeah.
Saurabh Mashruwala
And we have seen a 660 crores of the last year number.
Unidentified Participant
Okay, thank you. So my next question is on what would be your average realization for this quarter? Sir, realization and EBITDA for this quarter Average realization for the 700 MU’s which we sold.
Saurabh Mashruwala
So we have said 714 MU’s we have sold in the merchant market and contribution of 27 crores around 450 paisa.
Unidentified Participant
Okay sir. So just last question is on. We did a news report or media report on your company. Interested? Look at LND’s power asset.
Unidentified Participant
Any comments on that, sir?
Saurabh Mashruwala
No, we don’t want to give comment on this. We don’t want to give any comments on this at this moment.
Unidentified Participant
But are we looking at thermal assets? Are we always looking at thermal assets?
Saurabh Mashruwala
It’s a part of our strategy. We look at. Look at the thermal coal asset also developing coal asset or participating the IBC process also that we. It’s a continuous exercise. Most expeditions, the renewable side also in the cool side also.
Unidentified Participant
Understood. Thank you. Thank you for your response.
operator
Thank you. Before we take the next participant, we would like to remind the participants to press star and one ask a question. The next question is from the line of Bhavan Bhavrani V from Avendus Park. Please go ahead.
Unidentified Participant
Am I audible?
operator
Yes sir, you are.
Unidentified Participant
Yeah. So. So can you give an update on the UP discount privatization and where is the process at? When do we expect the beach to be opened?
Saurabh Mashruwala
It’s too early because government is working at the rfp. So that is what currently they are working. So it’s true that that is what the stage is currently. But we are definitely interested in participating the tenders as anyone comes. But currently the proposal is under finalization by the government. UP government.
Unidentified Participant
Okay. Okay. And my second question is on degen like at like if I look at the one QFI 26 PLF reported which is 21% translates to around 2300 million units of generation. So. So just trying to understand if we have sold about 714 in merchant. You know what, what are the other units being sold? Where is it sold to? Is it being sold to the distribution circle in Ahmedabad Surat?
Saurabh Mashruwala
No.
Saurabh Mashruwala
So I think you are considering this Amazon on annual basis.
Saurabh Mashruwala
Yeah, exactly. Divided by four. Four. Yes, exactly. So you. I think you are looking at the annual annual amuse, not the quarterly AMUSE.
Saurabh Mashruwala
20%.
Saurabh Mashruwala
You have to calculate for the 90 days.
Unidentified Participant
Okay, sorry. Yeah, you know. Yeah, that’s a mistake. One second. Yeah, yeah, you’re right. Like I was calculating for another plant. Got it, got it. And finally on the fact that how much would be the amount of units we are expecting to sell from or to put another way in merchant market in the second quarter.
Unidentified Speaker
I think we are not giving any estimates. As you rightly know that merchant market is pretty unpredictable. And on top of it, LNG prices are also very volatile. So it is very difficult for us to give you any estimates.
Unidentified Participant
Okay, sure, sure. Rishi. Okay. Thank you so much.
Saurabh Mashruwala
Thank you.
operator
Thank you. The next question is from the line of Nikhil Abyankar from UTI mutual fund. Please go ahead.
Nikhil Abhyankar
So just one question. Clarity on the NVN tender. So is it fair to assume that the fixed cost related to the Navy and tender relating to 2.3 billion units of minimum of take will be fully. Will get fully booked by end of Q3?
Saurabh Mashruwala
So its contract is currently running up to 15th of October depending upon the demand from their side. If it’s not fully utilized by that plane, government may extend some portion. Yes, but we can safely assume by QC it should get fully utilized.
Nikhil Abhyankar
Okay.
Nikhil Abhyankar
Fully utilize. Okay. And if it. If it doesn’t get utilized, we’ll be.
Saurabh Mashruwala
Will be get the minimum uptake fixed cost.
Nikhil Abhyankar
Sure.
Nikhil Abhyankar
Sure. Thank you.
Nikhil Abhyankar
That’s okay.
operator
Thank you. Participants who wish to ask a question, press star and one at this time. I repeat. To ask a question, please press star and one now. To ask a question, please press star and one now. Ladies and gentlemen, as there are no further questions from the participants, I now hand the conference over to Mr. Sourabh Mashuwala for closing comments.
Saurabh Mashruwala
Thank you everybody for joining Torrent Power sourcing calls. Thank you very much. We wish everybody to stay safe and healthy. Thank you so much. Thank you.
operator
Thank you. On behalf of Torrent Power Ltd. That concludes this conference. Thank you for joining us. And you may now disconnect your lines.
Unidentified Speaker
Thank you. It.