JSW Energy Ltd. share price target

In-line; sharp reduction in net debt and interest cost Merchant prices higher, but coal prices also increasing; Maintain Sell JSW Energy's (JSWE) 2QFY18 EBITDA declined 8% YoY to INR8.8b (in-line). PAT was up 37% YoY to INR2.9b due to certain one-offs in other income (+230% YoY to INR1.7b). Standalone EBITDA increased ~23% YoY (to INR2b) due to higher realization and low-cost imported coal inventory. However, it was more than offset by weakness at the Barmer power plant. Other key highlights: Impressive reduction in net debt of INR10b QoQ to ~INR127b on receivables...

Foray into Electric Vehicle Manufacturing Biz A Big Challenge JSW Energy (JSWEL) has reported a subdued performance in 1QFY18 largely due to lower generation from thermal plants and lower merchant realisation. Its revenue dipped by 8.9% YoY to Rs22.3 bn owing to 4.4% YoY decline in generation and lower average realisation of Rs3.5/unit vs. Rs3.6/unit in 1QFY17. In line with our estimate, its PAT declined by 38.9% led by lower generation and higher fuel cost. Net generation declined by 8.9% YoY to 4,017mn units mainly due to lower system demand. JSWEL announced foraying into electric vehicle business with investment of Rs40bn in next 3...

Revenue fell by 2.22% to Rs. 1862.08 Cr in Q4FY17 when compared to the previous quarter. Also it fell by 29.22% when compared with Q4FY16.

Revenue decreased by 7.11% to Rs. 1865.48 Cr in Q3FY17 when compared to the previous quarter

JSWELs 3QFY17 continues to highlight the tough times faced by it led by increasing coal prices and falling power demand and merchant prices. JSWEL reported PAT of Rs 214mn (-93% YoY) in line with our estimates. Vijaynagar plant PLF continues to be subdued (53% in 3QFY17 vs. 96% in 3QFY16). JSWEL has started supplying power under new short term PPA (650MW with Karnataka), however increase in imported coal prices continues to exacerbate the problem for JSWEL.

Lower Generation & Weak Merchant Realisation Dent Profits Net sales of JSW Energy (JSWEL) was impacted by lower generation, lower realisation which declined by 26.5% in line with our estimates. Revenue, EBITDA and reported PAT of JSWEL declined 26.7% yoy, 42.6% yoy & 90% yoy in 3QFY17, respectively. Net generation dipped by 23% yoy to 4,644mn units, primarily due to lower system demand and shutdown of Unit-I of 300MW at Ratnagiri plant due to turbine variations. JSWEL has lost 40% due to weak operational performance. Considering recent correction in stock price, we believe that the negatives relating to weak merchant...

JSWELs 1QFY17 net profit at Rs 3.7bn was largely in line with our estimate of Rs 3.5bn. The cut in guidance of merchant realisation for FY17 to Rs 4/kwh from Rs 4.3-4.35/kwh was a setback.

Revenue, Operating Profit Improve on Higher Generation Revenue, EBITDA and reported PAT of JSW Energy (JSWEL) grew 16.9% yoy, 37.0% yoy & 18.7% yoy in 1QFY17. Though net generation increased by 43% yoy during the quarter primarily due to generation from hydro power plants acquired in FY16 and improved performance of Ratnagiri plant it was partly offset by...

JSW Energy's (JSWE) 1QFY17 EBITDA rose 37% YoY to INR11.2b, led by contribution from the acquisition of hydro assets (+INR3.9b). Reported PAT increased 32% YoY to INR3.7b. Reported net debt to equity stood at 1.35x as of June 2016, down from the revised 1.5x as of March 2016 (1.77x under earlier GAAP). Other key changes on account of the adoption of Ind-AS are highlighted later. Realization down 9.4% QoQ: Power generation rose 43% YoY to 6.4bu. Long-term sales formed 62% of total sales (+~700bp YoY). Reported realization fell 8.1% YoY/9.4% QoQ to INR3.84/kWh due to a higher share of hydro volumes (which...