scorecardresearch

CESC share zooms 6% post strong Q4 show

The company reported a net profit of Rs 429 crore in Q4, up 13.5 per cent on a Y-o-Y basis. Profit in the year-ago period stood at Rs 378 crore

Representative Image Representative Image

Share of CESC Limited rose 6 per cent to hit a 52-week high of Rs 819.15 on BSE after the company reported a strong set of numbers for the quarter ended March 2021.

The stock opened 3.5 per cent higher at Rs 797.00 against the previous close of Rs 770.35 on BSE. Market cap of the firm rose to Rs 9,826.21 crore.

The share has delivered 30 per cent returns in the last 12 months and risen 28 per cent since the beginning of this year. CESC share stands higher than 5 day, 10 day, 20 day, 50 day, 100 day, and 200-day moving averages.

The company reported a net profit of Rs 429 crore in Q4, up 13.5 per cent on a Y-o-Y basis. Profit in the year-ago period stood at Rs 378 crore.

Revenue from operations stood at Rs 2,890 crore for the quarter ended March 2021 compared to Rs 2,621 crore a year ago.

For FY21, revenue from operations declined 4.2 per cent to Rs 11,639 crore from Rs 12,159 crore in the previous year. Net profit stood at Rs 1,363 crore against Rs 1,309 crore in the previous year.

"India and other global markets experienced significant disruption in operations resulting from uncertainty caused by the worldwide outbreak of Coronavirus pandemic," the company said.

Considering power supply being an essential service, management believes that there is not much of an impact likely due to this pandemic on the business of the Group except some lower demand and its consequential impact on supply and collection from consumers, which are believed to be temporary.

The Board of Directors of the company has approved a proposal to subdivide/split the company's existing equity share of a nominal value of Rs 10 each into 10 equity shares of a nominal value of Re 1 each, subject to the approval of the shareholders.

Motilal Oswal has assigned a 'Buy' call on the stock with a target price of Rs 905 per share.

"The stock trades at an attractive 7.2x/6.9x FY22E/FY23E P/E. We raise our FY22E EPS by 9 percent to account for higher profitability at Haldia as the new tariff order is delayed," the brokerage house said.