ICICI Securities: JSW Energy - First Big Renewable Step
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ICICI Securities Report
JSW Energy Ltd.’s subsidiary JSW Solar has received Letter of Awards (LoA) from Solar Energy Corporation of India Ltd. (SECI) to set up blended wind capacity totalling 810 megawatt (max solar energy blending allowed is 20%).
This is a positive development for the company, which has a vision to reach 10 gigawatt capacity in the next four-five years, especially after the termination of GMR Kamalanga Energy Ltd. acquisition and prolonged delay of Ind-Barath Energy Utkal Ltd.’s acquisition.
We now await the signing of power sale agreement (PSA) by SECI with a discom, after which commissioning will take 18-24 months. Hence, FY24 is likely to be the first full year of operations.
Total estimated cost of the project is Rs 47-48 billion with debt to equity financing of 75:25.
We believe JSW Energy will have sufficient cash flows to fund the equity requirement without affecting current dividends.
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