CESC's net profit grew by 2.1% YoY to Rs2.5bn in 2QFY18, in line with our estimate. Led by 3.1% YoY rise in realisations, its revenue rose by 3.6% YoY to Rs20.8bn, which was offset by higher power purchase cost and other expenses (+38.3% YoY). The proposed demerger of distinct business verticals into 4 separate entities augurs well for CESC, as the past diversification into unrelated businesses was the key overhang for the stock. As the valuations seem to have discounted all positives, we maintain our HOLD recommendation on the stock with a revised Target Price of Rs964 (from Rs903 earlier). Higher Operating Cost Drags EBITDA...