Rs 49 to Rs 289: This power stock turned into a multibagger in three years

Shares of JSW Energy Ltd have turned multibagger in the last three years. The stock of the power producer, which closed at Rs 49 on July 3, 2020 ended at Rs 289 in the previous session (July 3, 2023), delivering 490% returns during the period. In comparison, Sensex has risen 81.02% in three years.

JSW Energy stock closed 5.92% higher at Rs 289 on Monday against the previous close of Rs 272.85 on BSE. The stock zoomed to an intraday high of Rs 291.25, gaining 6.74% on Monday.

The energy stock has gained 41.15 per cent in a year and fallen 1.57 per cent in 2023. In a month, JSW Energy stock has climbed 15.28 per cent.

Total 5.62 lakh shares of the firm changed hands amounting to a turnover of Rs 16.07 crore on BSE. Market cap of the firm rose to Rs 47,531 crore in the previous session.

In terms of technicals, the relative strength index (RSI) of JSW Energy stands at 66.9, signaling it's trading neither in the overbought zone nor in the oversold zone. JSW Energy stock has a one-year beta of 1.6, indicating very high volatility during the period. JSW Energy shares are trading higher than the 5 day, 20 day, 50 day, 100 day and 200 day moving averages.

Cholamandalam Securities has assigned a target of Rs 430 for the energy major.

“Valuing the company at 10% discount to mean PER multiple (19x) on FY26e (EPS), per share target price comes at Rs 327. Based on DCF per share value comes to Rs 529. For the purpose of valuation, we have taken average of PER and DCF based per share value, to arrive at per share target price of Rs 430,” said the brokerage.

The stock hit a 52-week high of Rs 369 on September 5, 2022 and a 52-week low of Rs 198.05 on July 6, 2022.

Net profit in the fourth quarter of last fiscal fell 68% on lower margin and higher operational cost. Q4 profit came in at Rs 282.03 crore against Rs 877 crore in the corresponding quarter a year ago.

For FY23, net profit slipped 15% to Rs 1480 crore. Revenue from operations climbed 9% on higher sales to Rs 2,669.9 crore. FY23 revenue rose 26% to Rs 10,331 crore.

The company's board recommended a dividend of Rs 2 per equity share and also approved the re-appointment and remuneration of Sajjan Jindal as the chairman and managing director of the company for a period of five years with effect from 1 January, 2024, subject to the approval of the members of the company.

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