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R o b u s t r e s u l t s … . .
A robust topline (above our & Street estimates), commissioning of 500
MW (two units of Karcham Wangtoo) and increase in interest costs (on
account of commissioning of Karcham Wangtoo) resulted in PAT beating
our estimates and Street consensus (| 52.9 crore). While the stock is
cheap as compared to NHPC on a P/BV basis, delay in capacity addition
(on coal based power plants), possibility of equity dilution to fund its
investment in power projects are key risks for the stock. Due to
amalgamation of two subsidiaries – Bina Power Supply Co (1500 MW
under construction) and Jaypee Karcham Hydro Corp (1000 MW), with
itself has resulted in equity dilution of 26.5%. Hence, as a result, the no of
o/s shares have increased from 208.5 crore to 262.5 crore. We maintain
our BUY rating with a revised target price of | 50/ share.
ƒ Other highlights of the quarter
The company generated 1223 million units (MU) for the quarter (up
26% YoY, 563% QoQ). Average realisation for the quarter stood at |
2.55/kwhr (sales realisation at 88% of generation). Average
realisation from Karcham Wangtoo project was | 2.4/kwhr. The
company has VERs worth | 56 lakh this quarter. In FY12, the
company expect ~| 75 crore as sales from VERs. For FY14, JPVL
expects to earn | 200 crore/annum from Karcham Wangtoo project.
ƒ Status of projects near completion
JPVL has commissioned 500 MW of Karcham Wangtoo in Q1FY12.
The remaining 500 MW will be commissioned by Q2FY12. One unit
of Bara project (250 MW) has been delayed by three months. Hence,
incremental capacity commissioned would be 750 MW in FY12.
V a l u a t i o n
At the CMP of | 38, the stock is trading at P/E of 31.4x and 7.9x on FY12E
and FY13E EPS, respectively. Similarly, on P/BV multiple, the stock is
trading at 2.3x and 1.0x FY13E, respectively. The execution capability of
the parent company (JAL) renders significant comfort to upcoming
expansion plans. We are only taking projects commissioning by FY15 in
our valuation and value Karchana Project at 1x investment value.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
R o b u s t r e s u l t s … . .
A robust topline (above our & Street estimates), commissioning of 500
MW (two units of Karcham Wangtoo) and increase in interest costs (on
account of commissioning of Karcham Wangtoo) resulted in PAT beating
our estimates and Street consensus (| 52.9 crore). While the stock is
cheap as compared to NHPC on a P/BV basis, delay in capacity addition
(on coal based power plants), possibility of equity dilution to fund its
investment in power projects are key risks for the stock. Due to
amalgamation of two subsidiaries – Bina Power Supply Co (1500 MW
under construction) and Jaypee Karcham Hydro Corp (1000 MW), with
itself has resulted in equity dilution of 26.5%. Hence, as a result, the no of
o/s shares have increased from 208.5 crore to 262.5 crore. We maintain
our BUY rating with a revised target price of | 50/ share.
ƒ Other highlights of the quarter
The company generated 1223 million units (MU) for the quarter (up
26% YoY, 563% QoQ). Average realisation for the quarter stood at |
2.55/kwhr (sales realisation at 88% of generation). Average
realisation from Karcham Wangtoo project was | 2.4/kwhr. The
company has VERs worth | 56 lakh this quarter. In FY12, the
company expect ~| 75 crore as sales from VERs. For FY14, JPVL
expects to earn | 200 crore/annum from Karcham Wangtoo project.
ƒ Status of projects near completion
JPVL has commissioned 500 MW of Karcham Wangtoo in Q1FY12.
The remaining 500 MW will be commissioned by Q2FY12. One unit
of Bara project (250 MW) has been delayed by three months. Hence,
incremental capacity commissioned would be 750 MW in FY12.
V a l u a t i o n
At the CMP of | 38, the stock is trading at P/E of 31.4x and 7.9x on FY12E
and FY13E EPS, respectively. Similarly, on P/BV multiple, the stock is
trading at 2.3x and 1.0x FY13E, respectively. The execution capability of
the parent company (JAL) renders significant comfort to upcoming
expansion plans. We are only taking projects commissioning by FY15 in
our valuation and value Karchana Project at 1x investment value.
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