1. At a Glance
CESC — the power supplier that’s older than most equity investors’ SIPs — runs a utility empire under the RP-Sanjiv Goenka Group. It’s reliable, profitable, and occasionally… boring. But boring pays dividends.
2. Introduction with Hook
Think of CESC as the polite old uncle of the power sector — always shows up, pays dividends on time, and doesn’t chase validation on Twitter. It’s the Kolkata-based utility dinosaur still alive in the era of solar unicorns.
- ₹23,693 Cr Market Cap — steady mid-cap horse
- 11.7% ROE, 2.5% dividend yield — not thrilling, not failing
- 13% CAGR in share price over 5 years — compounding quietly
3. Business Model (WTF Do They Even Do?)
CESC = Integrated Utility. Translation:
- Generation: Thermal + Renewables
- Distribution: Power supply across Kolkata, Noida, and Chandigarh (recent acquisition)
- Subsidiaries & Ventures: Purvah Green Power, Bhojraj Renewables, Deshraj Solar Energy
- Revenue split: Mostly from regulated distribution biz (safe but slow)
Business strategy? “Buy power assets, sign PPAs, and never let the meter stop running.”
4. Financials Overview
| Metric (₹ Cr) | FY23 | FY24 | FY25 |
|---|---|---|---|
| Sales | 14,246 | 15,293 | 17,001 |
| Operating Profit | 2,274 | 2,276 | 2,689 |
| OPM % | 16% | 15% | 16% |
| Net Profit | 1,397 | 1,447 | 1,428 |
| EPS (₹) | 10.13 | 10.38 | 10.33 |
| Dividend Payout % | 45% | 44% | 44% |
TL;DR:
- Margins stable, not explosive
- Consistent profit and dividend play
- Zero drama, unless you count depreciation
5. Valuation
| Metric | Value |
|---|---|
| CMP | ₹179 |
| P/E | 17.3 |
| Book Value | ₹90.6 |
| P/B | 1.97x |
| Dividend Yield | 2.52% |
Fair Value Range:
Based on DCF, peer comp, stable cash flows:
₹165 – ₹210
You’re not here for multibagger fantasies — you’re here for reliability and compounding.
6. What’s Cooking – News, Triggers, Drama
Recent Headlines:
- 1 GW Wind Turbine Deal signed with Envision Energy
- 300 MW Solar Project in Rajasthan awarded
- 75 MW PPA with Tata Power, ₹5.47/unit
- Chandigarh Power Distribution — full acquisition done
Upcoming Triggers:
- Completion of new hybrid renewable projects
- MERC approvals for fresh PPAs
- Possible asset monetization or IPO of renewables?
7. Balance Sheet
| Metric (₹ Cr) | FY23 | FY24 | FY25 |
|---|---|---|---|
| Equity Capital | 133 | 133 | 133 |
| Reserves | 10,777 | 11,312 | 11,876 |
| Borrowings | 14,263 | 14,544 | 17,978 |
| Other Liabilities | 12,539 | 11,179 | 10,994 |
| Fixed Assets | 22,826 | 22,131 | 22,767 |
Takeaway:
- Steady capex via debt
- Networth expanding slowly
- No major balance sheet blowups
8. Cash Flow – Sab Number Game Hai
| ₹ Cr | FY23 | FY24 | FY25 |
|---|---|---|---|
| Cash from Ops | 1,978 | 2,351 | 2,582 |
| Cash from Investing | -545 | -564 | -3,013 |
| Cash from Financing | -2,457 | -1,642 | 1,337 |
| Net Cash Flow | -1,024 | 146 | 906 |
Yeh Kya Seekha?
- Strong operating cash = dividend-friendly
- Capex spike in FY25 due to renewables
- Cash flow volatility? Just funding cycles
9. Ratios – Sexy or Stressy?
| Ratio | FY23 | FY24 | FY25 |
|---|---|---|---|
| ROCE | 11% | 12% | 11% |
| ROE | 11% | 12% | 11.7% |
| Debtor Days | 56 | 54 | 52 |
| CCC (Days) | 56 | 54 | 52 |
| D/E (est) | ~1.3x | ~1.3x | ~1.5x |
Verdict:
- Moderate leverage, acceptable for utilities
- ROE in comfort zone
- No red flags, no wild swings
10. P&L Breakdown – Show Me the Money
| Quarter | Sales | OPM % | Net Profit | EPS |
|---|---|---|---|---|
| Jun ‘24 | ₹4,863 | 8% | ₹388 Cr | 2.85 |
| Sep ‘24 | ₹4,700 | 19% | ₹373 Cr | 2.66 |
| Dec ‘24 | ₹3,561 | 17% | ₹282 Cr | 2.00 |
| Mar ‘25 | ₹3,877 | 21% | ₹385 Cr | 2.81 |
Hmm…
- Seasonal demand shows in margin swings
- EPS is stable and sleep-friendly
11. Peer Comparison
| Company | CMP | P/E | Div Yld | ROCE | ROE |
|---|---|---|---|---|---|
| Adani Power | ₹595 | 17.9 | 0.00% | 22.5% | 25.7% |
| Tata Power | ₹408 | 34.9 | 0.55% | 10.8% | 11.0% |
| Torrent Power | ₹1,369 | 24.4 | 1.39% | 16.0% | 19.0% |
| CESC | ₹179 | 17.3 | 2.52% | 10.9% | 11.7% |
Conclusion:
- Best dividend yield in the set
- ROE/ROCE slightly behind Torrent
- Under the radar, but not underperforming
12. Miscellaneous – Shareholding, Promoters
| Category | Mar ’25 |
|---|---|
| Promoters | 52.11% |
| FIIs | 11.01% |
| DIIs | 25.10% |
| Public | 11.77% |
| Shareholders | 4.23 Lakh |
Bonus Fact
- 100% acquisition of Chandigarh Power = new growth lever
- No promoter share movement = stable management
13. EduInvesting Verdict™
CESC is like a prepaid electricity meter — predictable, regulated, and you always know what you’re getting. It won’t 10x your money, but it’ll pay your utility bill while you wait.
Great for:
✅ Dividend chasers
✅ Power sector fans
✅ “Buy and snooze” investors
Avoid if you’re:
❌ A momentum trader
❌ Expecting renewables rocketship growth overnight
Metadata
– Written by EduInvesting Analyst | July 21, 2025
– Tags: CESC, Utilities, RP Sanjiv Goenka, Dividend Stocks, Power Distribution, Kolkata Power Stock, Regulated Utility
