Reduce Indian Energy Exchange, target price Rs 127: Nuvama Wealth brokerage

Nuvama Wealth brokerage has reduce call on Indian Energy Exchange with a target price of Rs 127. The current market price of Indian Energy Exchange is Rs 124. Time period given by analyst is one year when Indian Energy Exchange price can reach defined target.

Indian Energy Exchange, incorporated in the year 2007, is a Mid Cap company (having a market cap of Rs 11213.04 Crore) operating in Financial Services sector.

Indian Energy Exchange key Products/Revenue Segments include Sale of services and Other Operating Revenue for the year ending 31-Mar-2022.


Invetmnet rationale
Currently, IEX is the most trusted platform for electricity spot price determination in India, which is its business moat. However, introduction of a full-fledged market coupler implies an independent third-party will collate all buy/sell bids and derive a uniform market price across all exchanges. This potentially negates IEX’s ‘moat’, as other exchanges can eat into its market share over time. The brokerage reiterated their BRAVEHEART ‘REDUCE’ rating on the stock with a TP of Rs 127.

Financials
For the quarter ended 31-03-2023, the company has reported a Consolidated Total Income of Rs 129.59 Crore, up 10.43 % from last quarter Total Income of Rs 117.35 Crore and up .89 % from last year same quarter Total Income of Rs 128.44 Crore. Company has reported net profit after tax of Rs 82.80 Crore in latest quarter.

The company’s top management includes Mr.Satyanarayan Goel, Mr.Gautam Dalmia, Mr.Amit Garg, Ms.Sudha Pillai, Mr.Tejpreet Singh Chopra, Prof.Kayyalathu Thomas Chacko. Company has BSR & Associates LLP as its auditors. As on 31-03-2023, the company has a total of 89 Crore shares outstanding.

FII Holdings
FIIs owned 17.88 per cent, DIIs 21.53 per cent.