Reliance Power Limited

Utilities — Utilities - Independent Power Producers · NSE

₹18.85+₹0.14 (+0.75%)

DalalBaazaar Score

40 / 100

🟡 Moderate

Verdict

CAUTION

Risk

Very High

Driven by moderate debt load, short-term liabilities exceed short-term assets, the company is currently loss-making.

In simple words: The company is currently losing money, with modest growth. Short-term liquidity is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 8:28 pm

Understanding the Business

Company site ↗

The 60-second version of Reliance Power Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Reliance Power Limited, together with its subsidiaries, engages in the development, construction, and operation of power plants in India and internationally. Its portfolio of power projects is based on coal, gas, hydro, wind, and solar energy.

IndustryUtilities - Independent Power Producers

SectorUtilities

Employees1,278

Annual revenue₹7,204 Cr

How does it make money?

Turns over ₹7,204 Cr a year. Of every ₹100 of sales, about ₹-5 reaches shareholders as profit, with ₹40 left at the operating level before interest, tax and depreciation. Each of its 1,278 employees supports ₹5.64 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹5.64 Cr

Who are its competitors?

The closest listed comparisons in its industry are NTPC LTD, POWER GRID CORP. LTD., TATA POWER CO LTD, ADANI POWER LTD. These are the companies its valuation and returns are measured against elsewhere in this report.

Compared side by side in Peers ↓

What is its competitive advantage?Little sign of one

Returns on capital of 4.5% are at or below what the capital likely costs. That is the financial pattern of a business competing largely on price, where advantage has to come from execution rather than position.

Peer median ROE15.8%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +2% while net margin moved -30% relative to itself. What this cannot tell you is which products, customers or geographies did the work — that lives in the segment disclosures of the annual report.

Revenue effect+2%

Margin effect-30%

DalalBaazaar Score

40/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Return on equity is negative

Quality vs. Valuation

Company Quality

39/ 100

Weak

How good the business is, ignoring the share price entirely.

Valuation

54/ 100

Fair

What you are being asked to pay, ignoring how good the business is.

Weak on business quality and not cheap enough to compensate.

vs. its own history

Not enough price and earnings history

vs. sector peers

Not enough peers with a usable P/E

vs. generic bands

N/A

No P/E — the company is lossmaking

EV/EBITDA

7.8x

PEG

—

What's Good / What's Bad

🟢 What's Going Well2

Margins are improving
EBITDA margin is up from 25.4% to 39.5% over 3 years.
Debt is being paid down
Total debt is down 30% over 3 years.

🔴 What Needs Attention0

Nothing stands out as clearly deteriorating on the years of data available.

Red Flags

4 items require attention · 2 high · 2 watch

🔴Thin interest coverageFinancial
Operating profit covers interest only 0.9x — little room if earnings dip.
🔴The company is lossmakingFinancial
Net profit of -₹337 Cr in the latest reported year.
🟡Interest coverage is deterioratingFinancial
Cover has fallen from 2.8x to 0.9x.
🟡Short-term liquidity is tightFinancial
Current ratio of 0.46 — near-term obligations exceed near-term assets.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from 25.4% to 39.5%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
Deleveraging frees up earnings
Debt is down 30% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.

🔴 Bear CaseWhat could go wrong?

The debt load needs earnings to hold up
Debt is 5.2x EBITDA. At that level a downturn in earnings turns a manageable balance sheet into a refinancing problem, and lenders get paid before shareholders.
Growth barely outpaces inflation
Revenue compounding at 0.8% a year is close to the rate prices rise, so the business is gaining little ground in real terms. That leaves the share price dependent on a re-rating rather than on earnings growth.
Earnings are hard to forecast
Profit has swung sharply from year to year, so any single year — good or bad — is a weak guide to the next. Cyclical earnings deserve lower multiples for that reason.
Size brings its own risk
Small Cap businesses are thinly traded, so exits are harder in a falling market and single events move the price more than they would for a larger company.
Several serious flags at once
2 high-severity checks triggered. Individually each has an explanation; together they raise the chance that something structural is wrong rather than a one-off.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1EBITDA margin holds above 38%✓ 39.5%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Debt / EBITDA falls below 3x✗ 5.2x
Already stretched, so this is a reduction target rather than a level to hold. Around 3x is where lenders typically start attaching conditions.
3Interest cover stays above 3x✗ 0.9x
How much operating profit can fall before interest stops being comfortably covered.
4Revenue growth stays above 4% a year✗ 0.8% CAGR
Latest reported year was 3.8%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
5Free cash flow remains positive✓ ₹2,708 Cr
Profit that never becomes cash eventually stops being profit.

Investment Checklist

6 / 11 checks passed

✗ Strong return on equity (ROE ≥ 15%)
✗ Strong return on capital employed (ROCE ≥ 15%)
✗ Healthy net margin (≥ 10%)
✓ Generates positive free cash flow
✓ Manageable leverage (Debt/Equity < 1.0)
✗ Adequate short-term liquidity (Current Ratio ≥ 1.0)
✓ Revenue growing year-over-year
✓ Profit growing year-over-year
✓ Not trading at an extreme valuation (P/E < 40x)
✓ Not buying right at the 52-week high
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

3 good · 4 neutral · 4 weak

Market Cap

₹7,796 Cr

Small Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

Not meaningful

Loss-making

Earnings are negative, so a P/E multiple can't be read here

P/B Ratio

0.49x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹-0.77

Loss-making

Negative earnings per share — the business is losing money

ROE

-2.1%

Weak

Weak capital efficiency

ROCE

4.5%

Weak

Low return on total capital employed

Debt/Equity

0.92x

Moderate

Moderate leverage

Revenue Growth (YoY)

3.8%

Modest

Modest growth

Profit Growth (YoY)

47.2%

Healthy

Profits growing at a healthy clip

Dividend Yield

None

No dividend yield reported — usually means no payout, but verify if one was recently initiated

Free Cash Flow

₹2,708 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

4.2x

Operating Margin

18.2%

Good

Healthy core-business profitability

Net Margin

-4.1%

Weak

Very little revenue reaches the bottom line

Current Ratio

0.46

Tight

Tight short-term liquidity

Beta (vs Nifty)

0.90

Market-like

Moves roughly in line with the market

52W Range Position

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

20.1 / 21.5

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

30.5

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹7,033 Cr	₹7,426 Cr	₹7,153 Cr	₹7,204 Cr	+0.8%
EBITDA	₹1,785 Cr	₹1,129 Cr	₹2,704 Cr	₹2,848 Cr	+16.8%
EBITDA Margin	25.4%	15.2%	37.8%	39.5%	—
PAT (Net Profit)	-₹471 Cr	-₹2,068 Cr	₹2,948 Cr	-₹337 Cr	—
EPS	₹-1.35	₹-5.46	₹7.2	₹-0.82	—
ROE	-4.1%	-17.8%	18.0%	-2.1%	—
ROCE	5.2%	0.0%	15.0%	4.5%	—
Total Debt	₹21,236 Cr	₹18,766 Cr	₹15,153 Cr	₹14,812 Cr	-11.3%
Free Cash Flow	₹3,639 Cr	₹3,174 Cr	₹1,938 Cr	₹2,708 Cr	-9.4%

🟡 Revenue has been broadly flat over 3 years (0.8% a year).

🟢 EBITDA has grown at 16.8% a year over 3 years.

🟢 EBITDA Margin has risen from 25.4% to 39.5% over 3 years (+14.1 pts).

🟢 ROE has risen from -4.1% to -2.1% over 3 years (+2.0 pts).

🟡 ROCE has held roughly flat at 4.5% over 3 years.

🟢 Total Debt has shrunk at 11.3% a year over 3 years.

🔴 Free Cash Flow has shrunk at 9.4% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹41,293 Cr

Total Liabilities

₹25,253 Cr

Cash & Equivalents

₹504 Cr

Operating Cash Flow

₹2,824 Cr

Capex

-₹116 Cr

Shareholding (proxy)

Institutional Holding

10.5%

Insider Holding

29.8%

Corporate Actions

Ex-Dividend Date

19 Nov 2015

Peer Comparison

Company	P/E	ROE
NTPC LTD	11.0x	13.7%
POWER GRID CORP. LTD.	14.6x	15.8%
TATA POWER CO LTD	29.3x	9.8%
ADANI POWER LTD	26.5x	21.9%

Recent News

2 mixed4 general

Reliance Power shares crash 5% as ED seizes ₹2,033 crore assets in FEMA case against Anil Ambani firm - What's next?

Livemint, 15 OctPrice move

🟡Mixed / dependsA price move rather than a change in the business. If the figures on this page have not moved, the fall is either an opportunity or news they have yet to catch up with.

Reliance Power share price drops 1.05% as ED's seizure order of about Rs 2027 crore hits sentiment

India Infoline, 14 OctPrice move

🟡Mixed / dependsA price move rather than a change in the business. If the figures on this page have not moved, the fall is either an opportunity or news they have yet to catch up with.

Reliance Power named in CBI second chargesheet in RHFL matter

scanx.trade, 18 Oct

Reliance Power (RPOWER) Share Price hits fresh 52-week low at Rs 19.05

Univest, 15 Oct

Reliance Power Gets ED Seizure Notice For Sasan Power Shares Worth Rs 2,027 Crore

NDTV Profit, 14 Oct

Reliance Power Gets ED Order to Seize Rs 2,027 Cr Sasan Shares

Equitypandit, 14 Oct

Watch Items

Trading very close to its 52-week low — worth checking whether this reflects a temporary setback or a structural problem.
Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

MiddlingBusiness Quality · Financial Health · Valuation

WeakGrowth · Profitability · Risk

Points for each in the Score ↑

Weak on the fundamentals

Poor scores on business quality without a price low enough to compensate. There is no obvious argument for owning this over a stronger company at a similar valuation. 2 high-severity red flags sit above this conclusion and should be read first.

3 of 5 tripwires tripped — Debt / EBITDA falls below 3x; Interest cover stays above 3x; Revenue growth stays above 4% a year · see Key things to watch ↑