Buy JSW Energy, target price Rs 810: Motilal Oswal Financial Services

Motilal Oswal Financial Services has a buy call on JSW Energy with a target price of Rs 810. The current market price of JSW Energy is Rs 630.65. JSW Energy, incorporated in 1994, is a Mid Cap company with a market cap of Rs 111507.63 crore, operating in the Power sector.

JSW Energy's key products/revenue segments include Power, Power Generation, Sale of services, Sale of Products, Interest, Other Operating Revenue for the year ending 31-Mar-2024.

Financials

For the quarter ended 30-09-2024, the company has reported a Consolidated Total Income of Rs 3459.40 crore, up 13.70% from last quarter Total Income of Rs 3042.66 crore and up 2.13% from last year same quarter Total Income of Rs 3387.36 crore. The company has reported net profit after tax of Rs 868.34 Crore in latest quarter.

The company's top management includes Mr.Sajjan Jindal, Mr.Desh Deepak Verma, Mr.Rajeev Sharma, Mr.Munesh Khanna, Mr.Sunil Goyal, Ms.Rupa Devi Singh, Mr.Pritesh Vinay, Mr.Parth Jindal, Mr.Ashok Ramachandran, Mr.Sharad Mahendra, Mr.Rajiv J Chaudhri. Company has Deloitte Haskins & Sells LLP as its auditors. As on 30-09-2024, the company has a total of 175 Crore shares outstanding.

Investment Rationale
Motilal Oswal Financial Services values JSW Energy's core business at 15x FY27 EBITDA, reflecting its strong operational performance and market position. The stake in JSW Steel is valued at a 25% discount to the current market price. The total equity value of JSWE was determined by aggregating the values from these different components, leading to a target price of Rs 810/share. Additionally, the brokerage sees an option value of Rs 60/share from KSK Mahanadi, which should materialize once the deal is approved.

Promoter/FII Holdings
Promoters held 69.32 per cent stake in the company as of 30-Sep-2024, while FIIs owned 14.92 per cent, DIIs 9.7 per cent.