MOSL: CESC (Buy)-Dhariwal starts full supplies to Noida PPA-Consolidated PAT grew 16% YoY in FY17
​cesc: Dhariwal starts full supplies to Noida PPA; Consolidated PAT grew 16% YoY in FY17; Re-iterate Buy
(CESC IN, Mkt Cap USD1.6b, CMP INR841, TP INR1040, 15% Upside, BUY)
- CESC’s 4QFY17 standalone PAT was broadly flat YoY at INR2.9b (ahead of estimate of INR2.5b) as we estimate that growth in regulated equity was offset by the impact of negative bid for the captive coal block. For FY17, PAT increased 2.1% YoY to INR8.6b. Consolidated PAT grew 16% YoY to INR6.9b.
- Standalone: Power sales declined ~5% YoY to 2.09BU on a strong base. EBITDA (including regulatory income/expense) was broadly flat YoY at INR5.4b. For a distribution business, EBITDA alone (down ~50% YoY) is not representative of the operating performance of the company, as the mismatch in recovery of cost for the period is presented separately under ‘Regulatory income/expense’ as per the accounting standards.
- Spencer: Revenue grew 9.6% YoY to ~INR20b in FY17. Reported sales per sq.ft/m were up 8.5% YoY to INR1,576. EBITDA loss declined from ~INR596m in 4QFY16 to INR460m in the quarter, led by operating leverage and efficiencies. EBITDA margin improved from negative 3.2% in the year-ago period to 2.3%. Reported store EBITDA was up ~INR15 per sq.ft/m YoY to INR101.
CESC is engaged in the business of generation and distribution of electricity within the licensed area of 567 sq. km in the city of Kolkata and adjoining areas and does not operate in any other reportable segment. The peak power demand in the licence area is now approximately 1,460 MW, which is met through CESC's internal generation capacities as well as through power purchased from the state and national grid. Power demand, however, fluctuates based on seasonality and the time of the day; the maximum demand for power is usually during the evening hours, with less power needs during rest of the day. The combined generating capacity of Co.'s four plants is 975 MW.
Motilal Oswal Financial Services Ltd. is a reputed name in Financial Services and Online Trading with group companies providing services such as Private Wealth Management, Retail Broking and Distribution, Institutional Broking, Asset Management, Investment Banking, Private Equity, Commodity Broking, Currency Broking, Principal Strategies & Home Finance.
Motilal Oswal Securities is a group company of Motilal Oswal Financial Service Limited which started as a stock trading company and has blossomed into well diversified firm offering a range of financial products and services. Motilal Oswal has built a reputation as the source for best stock trading company and this has taken a wealth of experience, knowledge and expertise, constantly working in tandem, over the years.
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