Arvind acquires stake in two Torrent Urja entities for renewable power
- Arvind terminates May 2025 power agreement with TU28 due to capacity reallocation
- Acquires 13.30% equity in TU12 with investment up to ₹3.47 crore
- Acquires 26.60% equity in TU21 with investment up to ₹17.33 crore
- Transactions are non-related party deals for captive renewable power procurement
*this image is generated using AI for illustrative purposes only.
Arvind has terminated its previous power agreement with Torrent Urja 28 Private Limited (TU28) and acquired equity stakes in two new entities to procure renewable energy.
Agreement termination
The Power Transfer Agreement (PTA) and Share Subscription and Shareholders Agreement (SSHA) dated May 12, 2025, with TU28 were terminated by mutual agreement on August 25, 2026. The termination was due to the reallocation of capacity. Arvind did not make any equity infusion or subscription towards TU28 shares and holds no equity participation in the entity.
New equity acquisitions
Pursuant to the capacity reallocation, Arvind entered into separate PTAs and SSHA agreements with Torrent Urja 12 Private Limited (TU12) and Torrent Urja 21 Private Limited (TU21). Both entities are generating companies defined under Section 2(28) of the Electricity Act, 2003, set up to establish Hybrid Power Projects in Gujarat.
| Entity | Equity Stake Acquired | Investment Amount |
|---|---|---|
| TU12 | 13.30% | Up to ₹3.47 crore |
| TU21 | 26.60% | Up to ₹17.33 crore |
The transactions are not related party transactions. The promoter group or group companies of Arvind have no interest in TU12 or TU21. The acquisitions aim to allow Arvind to offtake contracted electricity quantities as a captive user in Gujarat, citing significant financial and commercial benefits.
Transaction details
For TU12, incorporated on April 18, 2023, Arvind proposes to subscribe to equity shares in one or more tranches for an aggregate amount of up to ₹6.93 crore, representing a minimum 26.6% equity of the company. Arvind’s specific investment is capped at ₹3.47 crore for its proportionate share.
For TU21, incorporated on August 5, 2024, Arvind proposes to subscribe to equity shares for an aggregate amount of up to ₹17.33 crore, representing a minimum 26.6% equity. The investments are subject to the achievement of agreed milestones as per the terms of the agreements.
Historical Stock Returns for Arvind
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| +1.42% | -2.35% | +2.30% | +50.83% | +84.34% | +478.34% |
How will the shift to captive renewable energy via TU12 and TU21 impact Arvind's long-term operational cost structure and carbon footprint targets?
What are the specific performance milestones tied to the equity subscriptions in TU21, and what are the financial implications if these milestones are not met?
Given the reallocation of capacity from TU28, does this indicate a broader strategic pivot by Arvind towards hybrid power models over traditional power purchase agreements?
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