JSW Energy reports 48% decline in net profit; stock declines 7%

Shares of JSW Energy fell as much as 7 per cent, recording the day’s low at Rs 282.05 apiece. The stock slipped after the company posted a decline in consolidated net profit in the April-June quarter (Q1FY24). The scrip closed over 3 per cent lower at Rs 293.05 apiece on BSE.

The company informed bourses that the decline in profit was due to the one-time impact of non-operational expenses from the recent Mytrah buyout and the Ind-Barath 700 MW thermal plant deal under the insolvency route.

On Friday, July 14, post-market, the company reported a consolidated net profit of Rs 290 crore for the quarter ended June 30, compared to Rs 560 crore a year ago, which was down 48 per cent. The revenue also slipped by 3.25 per cent to Rs 2,927.85 crore against Rs 3026.27 crore a year ago. Earnings before interest, taxes, depreciation, and amortisation (EBITDA) was up 19.6 per cent at Rs 1,222.08 crore as against Rs 1,022.01 crore year-on-year (YoY), and margin—a key measure of profitability—was at 41.7 per cent as compared to 33.7 per cent (YoY).

Brokerage’s view

Citi has maintained a ‘sell’ on JSW Energy for a target of Rs 222 apiece. According to the report, the company reported weak 1QFY24 results, and the valuations are expensive. The brokerage believes that some lost EBITDA will be recovered during the year given the regulated nature of the projects, and the balance sheet also remains healthy.

JSW Energy's stock price history

So far in 2023, JSW Energy shares have soared 1 per cent as compared to the Nifty’s rise of nearly 8 per cent.

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