12 October 2018 CESCs board of directors has decided to go ahead with the demerger but with some modification. Instead of demerging the power business into generation and distribution, it will be keeping it as a single entity. CESC had all approvals, except from the electricity regulator for a power purchase agreement between to-be demerged power generation and distribution businesses. It will continue to actively seek the PPA and eventually demerge the power generation and distribution businesses. CESC will remain listed and house the power business. There is precedence from early 2000s where the state-owned electricity companies in India were split into generation, distribution and transmission businesses for better accountability. We believe the case of demerger of CESCs power business remains strong but could take time. We have made changes to our SOTP considering the power business now as one. This has increased cost of equity for the distribution business, resulting in ~10% cut in our SOTP value.