Torrent Power up 7%, hits 52 week high on lower spot LNG prices

Shares of power generation company Torrent Power surged up to 7 per cent at Rs 1,512 on Wednesday’s intraday trade on BSE. However, giving up the early gains the stock was trading at Rs 1,440 up 2.28 per cent at 12:15 PM. In comparison the S&P BSE was up by 0.76 per cent. 

The stock also reached its 52 week high at Rs 1,515 during the day’s trade. Around 3 lakh 39 thousand shares of Torrent Power traded handes on the BSE on Wednesday. 

This comes after the spot price of liquified natural gas was trading relatively lower to alternative fuels and recovered only slightly from its three year low. Using LNG to produce electricity lowers greenhouse gas, sulphur dioxide, and particulate matter emissions.

A recent report by JM Financials said that Asian spot LNG price recovered slightly at USD 9.4 metric million British thermal unit (mmbtu) or 11 per cent of Brent crude versus an historical average of 15 per cent but was still trading relatively lower against alternative fuel prices on account of weak demand and high inventory in both Asia and Europe. MMBTU is widely associated with measurement of natural gas in the energy terms globally.

The report further noted that the Asian spot LNG prices have moderated significantly during calendar year 2023 (CY23) and CY24 till date from record high levels witnessed in CY22. However, the LNG price has only slightly recovered from its 3-year low of USD 8.3/mmbtu. 

Torrent Power reported a 46 per cent dip in its consolidated net profit at Rs 374 crore in the third quarter of financial year 2024 (Q3FY24) against a net profit of Rs 695 crore in Q3FY23. The revenue from operations stood at Rs 6,366 crore in the December quarter of FY24 compared to Rs 6,443 crore in Q3FY23.

Apart from Torrent Power, oil and gas companies also witnessed a surge in their stock prices on lower LNG prices. GAIL was up by 1.19 per cent at Rs 182.65, and Indian Oil Corporation was trading 1.37 per cent higher at Rs 169.70 while Bharat Petroleum Corporation soared 1.04 per cent at Rs 606.80 on BSE.