Brokerage firm Jefferies has highlighted three key triggers for power generation company JSW Energy Ltd. that can play out over the next 12-24 months, thereby boosting its earnings prospects.

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The brokerage has maintained its buy recommendation on the stock and raised its price target to Rs 500 from Rs 365 earlier. The revised price target implies a potential upside of 26 percent from Monday's closing levels.

Jefferies believes that the improving visibility on renewable energy will be a key trigger for JSW Energy going forward. It expects Renewable Energy to move to 81 percent of capacity by financial year 2030, from 52 percent in financial year 2023.

The company is also likely to commission 700 MW of merchant capacity in times of peak power deficit. Currently, JSW Energy has 6.6 GW of operational capacity and under construction projects worth 3.2 GW, which are likely to be commissioned by calendar year 2024.

Another key trigger would be progress on one of India's first green hydrogen plant and energy storage battery unit will. The company has contracted for India's first plant to produce green hydrogen for production of green steel and also for the largest commercial scale green hydrogen plant to commence construction.

During its June quarter earnings, JSW Energy had raised its revenue and net profit projections for 2030 by 25 percent from the earlier targets that were set in 2021. The company expects its bottomline to rise by 5-6 times by 2030.

Shares of JSW Energy gained as much as 5.2 percent to Rs 414.35 post this note. The stock is off the day's high but continues to trade with gains.

The stock is currently trading 2.3 percent higher at Rs 403. Shares have gained 37 percent so far in 2023.

First Published:Sept 20, 2023 12:32 PM IST