We expect the Distribution entity to generate PAT of ~INR6.5b in FY18, increasing to ~INR7.5b by FY20, driven by growth in regulated businesses and improvement in franchisees. The Generation business should generate PAT of ~INR4b in FY18, increasing to ~INR5.5b by FY20 on lower losses at Dhariwal. On peer valuation basis, the Distribution business could be valued at INR90b-110b and Generation business at INR50b-60b. Both businesses should generate strong double-digit core RoE and healthy FCF. The combined estimated value of the two demerged entities (INR140b-170b) is greater than the current market capitalization of CESC