CESC (CESC IN) – Q1FY27 Result Update – RE guidance upgraded – BUY
Published on 14 Aug 2026
Reported Q1 consolidated PAT of INR 4.2bn (+4% YoY), 7% below our estimate, primarily due to higher losses at Malegaon. Malegaon loss widened to INR 430mn from INR 170mn QoQ, with T&D loss at 36% vs 33% QoQ. Standalone PAT grew 4% YoY, rajasthan Discoms continued their strong performance, reporting PAT of INR 190mn vs INR 80mn YoY, while Noida PAT grew 4% YoY to INR 520mn. CESC has raised its FY29 renewable capacity target to 4.5GW from 3.2GW earlier, following the proposed acquisition of ReNew’s 1.4GW operational renewable portfolio, which is expected to close by Oct-26. Of the 4.5GW FY29 target, PPAs for 4.3GW have already been signed, including the acquired capacity, while transmission availability has been secured for planned FY29 commissioning. We have incorporated the acquisition in FY27/28E, resulting in a 6%/11% upward revision to EBITDA estimates and raising our SOTP-based TP to INR220. At ~12x FY28E EPS, the stock remains attractively valued, in our view, given the expected 15% EBITDA CAGR over FY26-28E. BUY
