CESC surges 5%; CLSA upgrades, sees 60% returns in 2 years

Trade

• Watchlist
• Portfolio
• Message
• Set Alert

 

 

Choose Stock Exchange: BSE LIVE NSE LIVE

26 Aug, 2025 12:21

Volume

Todays L/H

More

×

Moneycontrol Bureau

Shares of CESC rallied as much as 5 percent intraday on Thursday after CLSA said it expects around 60 percent returns from the stock over next two years.

The brokerage house upgraded the power producer to buy with a 12-month target price of Rs 842 apiece incorporating stable Chandrapur operations from FY16 and higher valuations for Spencer’s.

Power generation capacity of CESC or Calcutta Electric Supply Corporation, the flagship company of the RP-Sanjiv Goenka Group, has increased by 50 percent with commissioning of Chandrapur (600MW). The company would increase power generation capacity by another 33 percent by end of this year with addition of Haldia (600MW), said the brokerage.

CLSA expects CESC’s consolidated earnings to treble over FY15-17 as the new power projects ramp-up and retail business breakeven, though it feels FY15 would however be a rough year for the power business of the company as Chandrapur’s utilisation would remain sub-optimal.

The stock has done really well over last 12 months on the back of First Source (BPO business), steady operational improvement at Spencers and with investors ignoring the near term pain of Chandrapur.

According to the brokerage, listing of the retail business and PPA tie-ups for Chandrapur would be the key medium term triggers. CLSA expects the consolidated net profit of the power producer to decline by 5 percent in FY15 but more than double in FY16 as losses from Chandrapur and Spencer’s decrease and Haldia ramps up.

At 15:03 hours IST, the stock was quoting at Rs 739.90, up Rs 32.65, or 4.62 percent on the BSE.

Posted by Sunil Shankar Matkar