CESC’s aggressive RE growth strategy with a plan to add 3.2GW (capex of ~Rs. 12-13k cr) in the next four years makes a good value proposition given the lower RE cost, strong growth prospects, and likely improvement in ESG rating. The long-term plan is to add 10GW capacity. The company has a framework agreement with Inox Wind and Suzlon Energy for wind turbine supply which is to be commissioned over next 2-4 years. Its subsidiary has been selected as a successful bidder for setting-up a 10,500 tonnes per annum of green hydrogen production facility in India. The company has implemented a 5.7% tariff hike for recovery of fuel and power purchase adjustment surcharge from June.
OutlookWe retain Buy on CESC with a revised PT of Rs. 236 on a SOTP basis. Renewable energy capex revival is going to drive the growth and turnaround of the distribution business would further aid the earnings.
For all recommendations report, click hereDisclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
CESC - 280824 - khanDiscover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
Find the best of Al News in one place, specially curated for you every weekend.
Stay on top of the latest tech trends and biggest startup news.
