Torrent Power Ltd gross margin has been in long-term decline. The average rate of decline per year is -5.4%.
The historical rank and industry rank for Torrent Power's Gross Margin % or its related term are showing as below:
BOM:532779'
s Gross Margin % Range Over the Past 10 Years
Min: 20.9 Med: 33.15 Max: 63.97
Current: 20.9
During the past 13 years, the highestGross Margin % of Torrent Power was 63.97%. The lowest was 20.90%. And the median was 33.15%.
BOM:532779's Gross Margin % is ranked worse than 70.53% of 397
companies
in the Utilities - Independent Power Producers industry
Industry Median: 35.58
vs BOM:532779: 20.90
Torrent Power had a gross margin of 24.86% for the quarter that ended in Dec. 2023 => Competition eroding margins
The 5-Year average Growth Rate of Gross Margin for Torrent Power was -5.40% per year.
Torrent Power Gross Margin % Historical Data
The historical data trend for Torrent Power's Gross Margin % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Competitive Comparison of Torrent Power's Gross Margin %
For the Utilities - Independent Power Producers subindustry, Torrent Power's Gross Margin %, along with its competitors' market caps and Gross Margin % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Torrent Power's Gross Margin % Distribution in the Utilities - Independent Power Producers Industry
For the Utilities - Independent Power Producers industry and Utilities sector, Torrent Power's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Torrent Power's Gross Margin % falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
A positive Gross Profit is only the first step for a company to make a net profit. The gross profit needs to be big enough to also cover related labor, equipment, rental, marketing/advertising, research and development and a lot of other costs in selling the products.
Torrent Power (BOM:532779) Gross Margin % Explanation
Warren Buffett believes that firms with excellent long term economics tend to have consistently higher margins.
Durable competitive advantage creates a high Gross Margin % because of the freedom to price in excess of cost. Companies can be categorized by their Gross Margin %
1. Greater than 40% = Durable competitive advantage
2. Less than 40% = Competition eroding margins
3. Less than 20% = no sustainable competitive advantage
Consistency of Gross Margin is key
Torrent Power had a gross margin of 24.86% for the quarter that ended in Dec. 2023 => Competition eroding margins
Be Aware
If a company loses its competitive advantages, usually its gross margin declines well before its sales declines. Watching Gross Margin % and Operating Margin % closely helps avoid value trap situations.
Torrent Power Gross Margin % Related Terms
Thank you for viewing the detailed overview of Torrent Power's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.
Torrent Power Ltd is an Indian utility company engaged in the business of power generation, transmission, and distribution. Both by itself and through its subsidiaries, Torrent Power operates a portfolio of gas, combined cycle, coal, wind, and solar power plants. The company's gas-fired facilities constitute most of its energy-producing capacity. Torrent Power generates the vast majority of its revenue from the supply of power generated by its facilities and transmitted through its power grids to areas of Western and Northern India. Its sales are fairly evenly divided among residential, commercial, low tension and high tension consumers. The low tension customer class would include smaller manufacturing units, while high tension would be composed of heavier industrial entities.
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