CESC Ltd. share price target

The overall industry PLF declined 246 bps YoY to 53.7% (excl. renewables). PLF declined across the Gas and Nuclear segment by 61 bps and 1354 bps YoY respectively. PLF across the Coal and the Hydro was up by 104 bps and 380 bps YoY. While base deficit increased marginally to 0.6% vs 0.5% MoM, peak deficit declined marginally to 0.7% vs. 0.8% MoM. On a YoY basis, both however, improved significantly from 1.6% each respectively. Rates on IEX increased 5.3% MoM to Rs 2.9/unit. In May 2017, net capacity addition was at 1,056 MW against the target of 980 MW....

In our view, CESCs demerger plan will lead to substantial value unlocking. The move would bring with it benefits like (1) Isolation of cash flows of the Power vertical from other businesses (one of the investors? key concerns) and (2) The opportunity to invest in a pure-play power distribution business, with steady cash flows and growth. Losses incurred by Spencers were the key hurdle for this demerger, in our view.

Revenue decreased by 2.96% to Rs. 1572.0 Cr in Q4FY17 when compared to the previous quarter

CESC reported a steady 4QFY17 with flat YoY PAT (Rs 2.95bn), despite the impact of a negative bid on its captive mine. The results were overshadowed by the much-awaited announcement of CESC?s corporate restructuring. The company would now be demerged into four entities, i.e. Discom, Genco, Retail and others.

The overall industry PLF was flat at 43.6%. PLF declined across the Gas and Nuclear segment witnessing a 314 bps and 1378 bps YoY fall respectively. PLF across the Coal and Hydro was up by 130 bps and 180 bps YoY respectively Both base and peak deficit declined to 0.3% and 0.5% respectively in March 2017 vs 0.5% and 0.6% respectively Mo Mie February 2017. Rates on IEX declined 1.6% YoY to Rs 2.6/unit. On a YoY basis, both peak and based deficit improved significantly from 1.6%...

The staff expenditure stood at `1,930 mn (-3.5% q/q; +4.9% y/y) and other expenditure stood at `8,570 mn (+0%q/q; +22.8% y/y) .Consequently, EBITDA margin stood at 19.4% (-990 bps q/q;-290 bps y/y). Depreciation stood at `980mn (-1% q/q; +10% y/y) .Interest expense stood at `1,080 mn (-6.9% q/q; +0.0% y/y). This decrease q/q was mainly due to lower...

Revenue decreased by 19.41% to Rs. 1574.0 Cr in Q3FY17 when compared to the previous quarter. On the other hand, it rose by 3.08% when compared with Q3FY16.

CESC reported better-than-expected Q3FY17 results on account higher-than-expected traded volume from the subsidiary. The power purchase from subsidiary increased 23% YoY to 129 crore units Lower fuel costs in the base business also helped EBITDA and profitability. The base business saw a decline in generation to the tune of 26.8% YoY to 117 crore unit. Revenues came in at | 1620 crore vs. our estimate of | 1542.5 crore Absolute EBITDA came in at | 315 crore, which was in line with our...

CESCs 3QFY17 result was ahead of our estimates led by Ind-AS adjustment on contribution from customers (Rs 410mn) and higher merchant sales (35 MUs vs. 7 MUs QoQ). These gains were partly negated by the WBERC order disallowing recovery of a negative bid on its captive mine. Consequently, PAT at Rs 1.5bn grew marginally by 5% YoY.

567 sq km of licensed area in Kolkata since 1897 serving 3 million consumers. This includes domestic, industrial and commercial users. Currently, on a standalone basis, CESC owns...