Technical Momentum Shift Boosts Torrent Power Ltd. to Buy Rating

Technical Trend Reversal Signals Bullish Momentum

After a prolonged sideways movement, Torrent Power’s technical trend has decisively turned bullish. The daily moving averages have aligned positively, with the stock price currently trading at ₹1,484.95, up 0.78% from the previous close of ₹1,473.45. The stock’s intraday range today spanned ₹1,464.95 to ₹1,494.25, indicating healthy buying interest near the upper band.

On the weekly chart, the Moving Average Convergence Divergence (MACD) indicator has shifted into bullish territory, signalling increasing upward momentum. However, the monthly MACD remains mildly bearish, suggesting some caution over the longer term. The Relative Strength Index (RSI) on both weekly and monthly timeframes currently shows no definitive signal, hovering in neutral zones, which implies the stock is neither overbought nor oversold.

Bollinger Bands reinforce the bullish case, with both weekly and monthly bands expanding upwards, indicating rising volatility accompanied by upward price movement. The Know Sure Thing (KST) oscillator is bullish on the weekly scale but mildly bearish monthly, mirroring the MACD’s mixed timeframe signals.

Volume and Trend Confirmation Indicators

On-Balance Volume (OBV) analysis reveals no clear trend on the weekly chart but shows bullish accumulation on the monthly scale, suggesting institutional buying interest over the medium term. Dow Theory assessments indicate no clear trend weekly but a mildly bullish stance monthly, supporting the technical upgrade.

These mixed signals across different timeframes highlight a transitional phase where short-term momentum is gaining strength, while longer-term indicators await confirmation. Investors should monitor these oscillators closely for sustained directional cues.

Comparative Performance Outpaces Sensex

Fundamental strength complements the technical momentum. Torrent Power’s stock returns have significantly outperformed the Sensex across multiple time horizons. Over the past week, the stock gained 0.11% while the Sensex declined 0.98%. The one-month return stands at 9.40% versus a marginal Sensex dip of 0.14%. Year-to-date, Torrent Power has surged 13.67%, contrasting with the Sensex’s 2.08% decline.

Longer-term performance is even more impressive, with a 19.70% gain over one year compared to Sensex’s 9.81%, and a remarkable 192.95% return over three years against the benchmark’s 36.80%. Over five and ten years, the stock has delivered 331.80% and 574.82% returns respectively, dwarfing the Sensex’s 61.40% and 256.90% gains. This consistent outperformance underscores Torrent Power’s resilience and growth potential within the power sector.

Mojo Score and Grade Upgrade Reflect Confidence

MarketsMOJO’s proprietary Mojo Score for Torrent Power currently stands at 70.0, reflecting a strong Buy rating. This marks an upgrade from the previous Hold grade, effective 17 Feb 2026. The company’s market cap grade remains modest at 2, indicating a mid-cap classification with room for growth. The upgrade is driven by improved technical indicators and positive price momentum, signalling enhanced investor confidence.

Such a rating upgrade often attracts increased institutional interest, potentially driving further price appreciation. Investors should note that while the technical outlook is encouraging, the mildly bearish monthly MACD and KST suggest monitoring for any reversal signals.

Valuation and Price Range Context

Currently trading at ₹1,484.95, Torrent Power remains below its 52-week high of ₹1,640.00, offering a potential upside of approximately 10.5%. The 52-week low of ₹1,188.00 provides a strong support base, with the stock comfortably above this level. This price positioning within the annual range indicates a healthy recovery and room for further gains.

Given the bullish daily moving averages and expanding Bollinger Bands, the stock appears poised to test higher resistance levels. However, investors should remain cautious of broader market volatility and sector-specific risks such as regulatory changes and fuel price fluctuations.

Sector Outlook and Risks

The power sector continues to face headwinds from fluctuating fuel costs, regulatory scrutiny, and evolving renewable energy mandates. Torrent Power’s diversified portfolio and operational efficiencies provide a buffer against these challenges. Its technical upgrade aligns with improving fundamentals and strategic initiatives to enhance profitability and cash flow.

Investors should weigh the bullish technical signals against sector volatility and macroeconomic factors. The mildly bearish monthly indicators warrant vigilance for any signs of momentum loss. Nonetheless, the current technical and fundamental alignment suggests Torrent Power is well-positioned for sustained gains in the near to medium term.

Conclusion: A Compelling Buy Opportunity

In summary, Torrent Power Ltd.’s recent technical parameter changes mark a clear shift from sideways to bullish momentum. The convergence of positive MACD, moving averages, and Bollinger Bands on shorter timeframes, combined with strong relative returns versus the Sensex, underpin the MarketsMOJO upgrade to a Buy rating. While some monthly indicators advise caution, the overall trend favours accumulation and potential price appreciation.

For investors seeking exposure to a fundamentally sound and technically robust power sector stock, Torrent Power presents a compelling opportunity. Monitoring ongoing technical signals and sector developments will be key to capitalising on this momentum.

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