JSW Energy Shares Surge 3.3% Following Morgan Stanley’s 'Overweight' Rating and Rs 545 Price Target

JSW Energy stock jumps 3.3% after Morgan Stanley maintains an 'overweight' rating and sets a Rs 545 target price, signaling a 16.5% upside potential.

Shares of JSW Energy rose by 3.3% to Rs 484 in early trading on February 21, 2025, continuing their upward momentum for a fourth consecutive session. This surge came after international brokerage firm Morgan Stanley maintained its 'overweight' rating on the stock and set a price target of Rs 545.

The price target suggests a potential upside of 16.5% from the last closing price of Rs 468 on the National Stock Exchange (NSE). Despite a challenging start to 2025, with the stock down 27% year-to-date, the analysts remain optimistic about the company’s long-term prospects.

Morgan Stanley’s Bullish Outlook on JSW Energy

Morgan Stanley's analysts are confident in JSW Energy's well-integrated business model and its strong positioning within India’s energy transition and security sectors. The company is expanding its green energy initiatives, investing in storage assets, and growing its thermal segment through strategic acquisitions. Additionally, JSW Energy has managed to capture market share in recent competitive bidding processes.

Looking ahead, Morgan Stanley forecasts a robust 24% EBITDA compound annual growth rate (CAGR) for FY24-28, with renewable energy EBITDA expected to grow at a notable 52% CAGR.

Financial Results and Performance Update

JSW Energy, a private power producer under the JSW Group, reported a 27% year-on-year decline in consolidated net profit for Q3FY25, mainly due to lower revenues from its thermal and hydropower plants. The company’s net profit for the quarter ended December 31, 2024, stood at Rs 168 crore, down from Rs 231 crore in the same quarter of the previous year.

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Q3FY25 revenues also saw a slight dip, falling to Rs 2,640 crore from Rs 2,661 crore in Q3FY24. This decline was attributed to lower short-term realizations at the Ratnagiri and Vijayanagar plants, despite a boost in revenues from renewable energy capacity additions and the Utkal Unit -1.

At 9:20 am on February 21, JSW Energy shares were trading at Rs 480, a 2.5% increase from the previous close on the NSE. However, the stock is still 42% lower than its all-time high of Rs 809.

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