Torrent Power to acquire Nabha Power from L&T for ₹6,889 crore

NEW DELHI: Torrent Power Ltd has entered into a definitive agreement with L&T Power Development Ltd (L&TPDL), a wholly owned subsidiary of Larsen & Toubro (L&T), to acquire a 100% equity stake and convertible instruments in Nabha Power Ltd (NPL) for an enterprise value of ₹6,889 crore.

NPL is a wholly owned subsidiary of L&TPDL, and the transaction is subject to regulatory approvals and customary closing conditions, Gujarat-based Torrent Power said in a statement on Monday.

NPL is a fully contracted thermal power asset that reported revenue of ₹4,866 crore in FY25. The company operates a 1,400 MW (2×700 MW) supercritical coal-fired power plant at Rajpura in Punjab’s Patiala district.

“The supercritical plant, built on advanced Japanese technology, maintains sustained availability levels above 90%. Strategically located in a power-deficit region, the plant also supports potential ancillary revenue streams. Furthermore, existing infrastructure allows for seamless expansion of capacity, supporting future growth opportunities,” the statement said.

Upon completion, Torrent Power’s operational capacity will increase from 5 GW to 6.4 GW.

“In addition, Torrent will gain NPL’s institutional expertise and decade-long technical capabilities, developed through exceptional implementation and operational excellence. This acquisition creates valuable synergies that will strengthen Torrent’s greenfield thermal power development strategy,” the company added.

EY acted as the exclusive M&A advisor to L&T on the transaction.

“The acquisition marks Torrent’s entry into the high-growth power market of northern India…The acquisition will be value accretive from day one, delivering a meaningful uplift in the overall revenues and profitability,” said Samir Mehta, chairman, Torrent Power.

S.N. Subrahmanyan, chairman and managing director of L&T, said the divestment aligns with the group’s strategy of unlocking value to strengthen its core businesses. “This move positions us to create long term value for all our stakeholders — business partners, shareholders and employees.”

L&T is a $30 billion Indian multinational group with core strengths in project engineering and construction, capital goods manufacturing, and technology-led services, with operations spanning infrastructure, energy, defence, heavy engineering, IT and financial services across domestic and international markets.

Commissioned in 2014, NPL’s Rajpura plant has long-term fuel supply agreements with South Eastern Coalfields Ltd (SECL) and Northern Coalfields Ltd (NCL) for 2.775 million tonnes and 2.464 million tonnes, respectively, along with provisions for alternate coal procurement to address supply shortfalls. The plant’s equipment is designed to blend domestic and imported coal, providing operational and fuel flexibility.

Torrent Power currently has an installed generation capacity of 5,039 MWp (megawatt peak), comprising 2,730 MW of gas-based capacity, 1,947 MWp of renewable capacity and 362 MW of coal-based capacity. Renewable projects of 4 GWp, pumped storage capacity of 3 GW and 1.6 GW of coal-based power capacity are under development.

In distribution, the company supplies nearly 31 billion units of electricity to about 4.21 million customers across Ahmedabad, Gandhinagar, Surat, Dahej SEZ and Dholera SIR in Gujarat; Dadra and Nagar Haveli and Daman and Diu; Bhiwandi, Shil, Mumbra and Kalwa in Maharashtra; and Agra in Uttar Pradesh.

The acquisition comes as India’s power generation capacity expands rapidly amid rising electricity demand.

On Sunday, the power ministry said that generation companies have added a record 52.53 GW of capacity so far this financial year, surpassing the previous high of about 34 GW in FY25. Of the total additions, renewable energy accounted for 39.65 GW, while coal-based capacity additions stood at 8.8 GW.

The acquisition also coincides with India’s plans to add 97 GW of coal-based capacity in the near term to meet rising demand and ensure grid stability.

India’s total installed power capacity currently stands at about 520 GW, including 248.54 GW of fossil fuel-based capacity and 271.97 GW of non-fossil capacity. The government aims to achieve 500 GW of non-fossil capacity by 2030 and net-zero emissions by 2070.