JSW Energy shares jumped 6% today; JM says Buy stock, Kotak sees 56% downside!

Shares of JSW Energy climbed 6 per cent in Wednesday's trade as the company declared healthy set of March quarter results and announced a final dividend for FY23. The stock also gained as the company board approved raising of funds not exceeding Rs 10,000 crore in one or more tranches.

JSW Energy continues to focus on an aggressive growth path, with investments in new thermal and renewable assets, as well as storage solutions, said Kotak Institutional Equities. While the plans and execution are encouraging, Kotak believes all positives are captured in the prevailing market price at 31 times FY2026 EPS and 3 times P/BV. It maintained its 'SELL' on the stock with a revised SoTP-based fair value of Rs 275 per share from Rs 235 per share earlier.

JSW Energy reported a 22.4 per cent YoY rise in net profit at Rs 345.30 crore for the March quarter. Revenue for the quarter was up 3.2 per cent YoY at Rs 2,755.90 crore. On Wednesday, The stock rose 8.54 per cent to hit a high of Rs 618 on BSE. Kotak's target suggests 56 per cent potential downside for the stock.

JM Financial said JSW Energy's revenue growth was led by improvement in net generation (up 26 per cent YoY) at 6.4 BUs driven by RE additions, higher thermal generation and acquired assets.

It noted that JSW Energy added/secured greenfield RE capacity of 681MW/3.4GW during FY24, taking RE locked-in capacity to 13.2 GW along with SECI’s 250MW/500MWh BESS project.

"It is also securing the wind energy supply chain with the signing of a technology licensing agreement with SANY Renewable Energy, China. We believe the company is right on track to achieve its target of 10GW/20GW RE capacity by 2025/2030. We maintain our BUY rating on the stock, with a SOTP-based target price of Rs 648," JM Financial said.

The brokerage values the JSW Energy stock at 11 times FY26 blended EV/Ebitda.