JSW Energy Share Price Target at Rs 612: ICICI Securities
ICICI Securities has reiterated its BUY recommendation on JSW Energy (JSWE), revising the 12-month target price to Rs 612, reflecting a 26% upside from the current market price of Rs 487. This optimism stems from JSWE’s aggressive shift toward renewables and energy storage, bolstered by timely acquisitions and operational capacity ramp-ups. The company’s ambitious goal of achieving 30GW of power generation and 40GWh of storage capacity by 2030 is underpinned by robust financials, diversified execution, and a steady earnings trajectory. While some challenges remain, JSWE's long-term fundamentals continue to shine bright.
Locked-in Capacity Skyrockets to 30GW
JSW Energy’s generation capacity as of April 2025 surged to approximately 30GW, a sharp 2.3x jump from March 2024. This remarkable build-out was driven by:
Two major acquisitions: O2 Power and KSK Mahanadi, adding 9.3GW.
1.6GW greenfield thermal project secured via a 25-year PPA.
~10.3GW renewable capacity, of which 1.3GW came from inorganic expansion.
On the energy storage front, locked-in capacity reached 29.3GWh, up 13GWh in Q4 alone.
This significant asset pipeline aligns with JSWE’s 2030 ambition and enhances its visibility in both generation and storage segments.
Strengthening Operational Muscle with Accelerated Commissioning
JSW Energy’s operational portfolio rose to 12.2GW as of April 2025 from 7.3GW a year earlier. This expansion includes:
Commissioning of Utkal Unit-II (350MW thermal).
Addition of 1.3GW wind and 1.8GW KSK Mahanadi thermal capacity.
Upcoming commissioning of 0.6GW RE capacity by June 2025.
With an under-construction portfolio of 11.3GW and an additional 6.7GW in the pipeline, JSWE has lined up Rs 1.3 trillion capex over FY26–30. The FY26 capex guidance alone stands between Rs 150–180 billion.
Q4FY25 Earnings: Steady Topline with Margin Pressure
JSW Energy reported a 16% YoY increase in Q4FY25 revenue, reaching Rs 31.9 billion, while EBITDA rose 3% to Rs 12 billion. Net profit increased 16% YoY to Rs 4.1 billion, aided by:
INR 2 billion EBITDA contribution from KSK Mahanadi.
Higher treasury income and deferred acquisition considerations from Mytrah.
| Metric | Q4FY25 | YoY % |
|---|---|---|
| Revenue | Rs 31,894 mn | +16% |
| EBITDA | Rs 12,045 mn | +3% |
| PAT | Rs 4,081 mn | +16% |
| EPS | Rs 2.5 | +16% |
Green Hydrogen and Energy Storage: Long-Term Growth Engines
JSWE is making significant inroads into green hydrogen with a 3,800 TPA project expected to commission in H1FY26. The energy storage vertical has also gained strategic traction:
Two new pumped storage projects of 12GWh each secured.
Total locked-in energy storage capacity now at 29.3GWh.
These segments will be pivotal in ensuring grid stability and clean energy integration, thus positioning JSWE as a leader in India's energy transition.
Segmental Highlights: Renewables and Utkal Lead the Charge
Q4FY25 witnessed stellar performance from the renewable and Utkal units:
| Segment | Revenue (Rs mn) | YoY Change |
|---|---|---|
| Renewables | 2,100 | +119% |
| JSW Utkal | 3,170 | +158% |
| KSK Mahanadi | 4,410 | NA |
| Hydro | 1,810 | +6% |
Correspondingly, segmental EBITDA rose sharply:
| Segment | EBITDA (Rs mn) | YoY Change |
|---|---|---|
| Renewables | 1,940 | +120% |
| Utkal | 680 | +127% |
| KSK Mahanadi | 1,950 | NA |
Financial Forecast: Revenue Doubling by FY27
ICICI Securities expects revenue to almost double to Rs 2,52,656 million by FY27, with EBITDA margins expanding to 54.5%. Key financial projections include:
| Metric | FY25A | FY26E | FY27E |
|---|---|---|---|
| Revenue | Rs 1,17,454 mn | Rs 2,22,210 mn | Rs 2,52,656 mn |
| EBITDA | Rs 52,208 mn | Rs 1,12,029 mn | Rs 1,37,579 mn |
| EPS | Rs 11.2 | Rs 17.1 | Rs 21.0 |
| RoE (%) | 7.9% | 9.4% | 9.5% |
Valuation and SoTP-Based Target Breakdown
The revised target price of Rs 612 is based on a sum-of-the-parts (SoTP) valuation:
| Project/Asset | Methodology | Value (Rs mn) |
|---|---|---|
| Thermal Assets | NPV & EV/EBITDA | 2,67,086 |
| Hydro Assets | NPV | 81,415 |
| Renewables | EV/EBITDA (11x) | 6,05,015 |
| Cash & Other Assets | Net Additions | 1,14,312 |
| Total Valuation | SoTP | 10,67,828 |
Based on 1,748 million outstanding shares, the target price arrives at Rs 612 per share.
Key Risks to Monitor
Despite its compelling outlook, investors should remain cautious of the following:
Execution delays in under-construction and renewable projects.
Volatility in merchant power prices impacting revenue forecasts.
Equity dilution risk at holdco/SPV level to fund the Rs 1.3 trillion capex plan.
Final Word: JSW Energy Powers Ahead in India’s Green Shift
JSW Energy has rapidly transformed from a thermal-heavy entity to a diversified green energy behemoth, with an eye on scale, efficiency, and innovation. With a fortified asset pipeline, robust execution strategy, and scalable financials, JSWE is on course to play a defining role in India’s energy transition.
