Shares of the power producing company JSW Energy jumped up to 6 per cent as the company reported strong 1QFY23 results with 135 per cent YoY profit growth, on the back of higher revenues. Net profit rose to Rs 560 crore in Q1, on the back of higher revenues. Profit after tax for the corresponding quarter of the previous fiscal stood at Rs 201 crore. Total revenue climbed 68 per cent YoY to Rs 3,115 crore from Rs 1,860 crore in the first quarter of FY22.
The company said it was well-positioned to pursue growth backed by one of the strongest balance sheets in the sector and a profitable and cash-generative operating portfolio. Its cash and cash equivalents stood at Rs 1,825 crore as of June end.
Buoyed by the strong earnings, JSW Energy stock opened with a gain of 4.91 per cent at Rs 245.70 today against the previous close of Rs 234.20 on BSE. The stock touched an intraday high of Rs 250.05, gaining 6.77 per cent. The share trades higher than 5-day and 20-day moving averages but lower than 50-day, 100-day and 200-day moving averages.
The stock has gained 10.06 per cent in a year and lost 20.51 per cent in 2022. In a month, JSW Energy stock has climbed 16.21 per cent. Total 1.39 lakh shares of the firm changed hands amounting to a turnover of Rs 3.43 crore on BSE. Market cap of the firm rose to Rs 39,374 crore.
The increase in revenue is backed by higher contribution from short-term sales, solar capacity addition at Vijayanagar and 45MW uprating at Karcham Wangtoo.
Underlying finance costs during the quarter fell 2.5 per cent YoY to Rs 193 crore on the back of 18 bps (basis points) reduction in the weighted average cost of debt partially offset by an increase in gross debt, the company said.
JSW Energy posted an over eight-fold jump in consolidated net profit at Rs 864 crore for the fourth quarter ended March 2022, on the back of higher revenues. The company had reported a consolidated net profit of Rs 107 crore in the year-ago period.
What Should Investors Do Now?
Kotak Institutional Equities commended JSW Energy for setting aggressive growth targets based on renewable energy and exploring new business opportunities for green hydrogen. “JSW Energy management demonstrated its ability to pursue return accretive growth while having evaluated several inorganic opportunities,” it said.
However, the domestic brokerage house maintained its ‘sell’ rating as it believes the current stock price discounts all the benefits of targeted capacity additions and consequential improvement in earnings all the way up to the financial year 2030.
Meanwhile, Jefferies said ‘buy’ JSW Energy shares with a target price of Rs 315, which implies an upside of 28 percent from the current market price of Rs 245.35. Kotak Institutional Equities has a target price of Rs 115.
“JSW Energy was possibly the only major private sector power company that did not bid aggressively in the tariff-based competitive bidding period of 2008-12. The company has kept its B/S intact, with d:e well below 3x and reasonable return ratios. The company owns 70.03 mn shares of JSW Steel, which we have not valued separately,” the global brokerage said.
Read all the Latest News, Breaking News, watch Top Videos and Live TV here.
Comments
0 comment