CESC Ltd
Stock Snapshot
Price Performance
Vista Outlook
View Technicals Analysis →Basis of our Recommendation
CESC Ltd's management has articulated a clear strategy focused on transitioning to a renewable-heavy portfolio, highlighted by the acquisition of ReNew's 1.4GW operational assets and an ambitious target to reach 10GW of renewable capacity by FY32. This strategic pivot is expected to enhance revenue growth and improve margins, supported by a robust balance sheet and ongoing operational improvements in its core distribution business. However, the company faces challenges from rising operational costs and execution risks associated with its extensive capital expenditure program. Vista's financial outlook reflects stable revenue growth and margins, aligning with management's optimistic tone regarding the renewable pipeline. The anticipated commissioning of new projects and the integration of acquired assets are expected to drive long-term growth, although regulatory shifts and market volatility remain watchpoints. Overall, CESC is well-positioned to capitalize on the expanding electricity demand, particularly from data centers and AI, while navigating competitive pressures in the power utilities sector
Why We Like This Stock
- CESC's acquisition of ReNew's assets provides immediate scale and cash flow, enhancing its competitive position
- The company's ambitious target of 10GW renewable capacity by FY32 supports long-term revenue growth and margin stability
- Operational improvements in T&D losses and a strong balance sheet underpin a stable financial outlook
Things To Watch Out For
- Rising operational costs and execution risks associated with the extensive capital expenditure program could pressure margins
- Persistent losses in the Malegaon distribution franchise represent a significant operational challenge
- Potential regulatory shifts in the power sector may impact future profitability and operational efficiency
Key Parameters
Financial Snapshot
| Actuals | Forecast | ||||
|---|---|---|---|---|---|
| FY24 | FY25 | FY26 | FY27 | FY28 | |
| Revenue (Cr.) | 15,293 | 17,001 | 18,570 | 18,769 | 21,353 |
| Profit Before Tax (Cr.) | 1,649 | 1,728 | 2,119 | 2,031 | 2,334 |
| PBT Margin | 10.8% | 10.2% | 1141.1% | 10.8% | 10.9% |
| Net Profit (Cr.) | 1,291 | 1,322 | 1,618 | 1,544 | 1,690 |
| Earnings Per Share | 9.2 | 9.5 | 11.6 | 11.1 | 12.7 |
Analyst Recommendations
| Broker | Recommendation | Target Price | Date |
|---|---|---|---|
| Elara Capital | ▲ Buy | 228 | 14-Aug-2026 |
| ICICI Securities | ▲ Buy | 220 | 07-May-2026 |
| JMFinancials | ▲ Buy | 214 | 09-Jun-2026 |
| Prabhudas Liladhar | ▲ Buy | 220 | 14-Aug-2026 |
Company Overview
Show Company Profile
CESC Limited, an integrated electrical utility company, engages in the generation and distribution of electricity in India. It owns and operates two thermal power plants, including Budge Budge generating station with a generating capacity of 750 megawatts and Southern generating stations with a generating capacity of 135 megawatts; a 40-megawatt atmospheric fluidized bed combustion power plant in Asansol, West Bengal; a 300-megawatt solar project in Bhadla, Rajasthan; a 450-megawatt hybrid project comprising a 150-megawatt solar unit and 300-megawatt wind unit in Mandsaur, Madhya, Pradesh; and a 450-megawatt hybrid project that consists of a 150-megawatt solar unit in Bikaner, Rajasthan and a 300-megawatt wind unit in Ananthapuram, Andhra Pradesh. The company was founded in 1899 and is headquartered in Kolkata, India.