CESC Ltd.
NSE: CESCCESC Ltd.: A 30-second snapshot
CESC is a Kolkata-based integrated power utility trading at ₹180.09 with a trailing PE of 15.5 — the lowest among its listed power sector peers — and a forward PE of 12.6, reflecting FY26 earnings growth of 17%. The balance sheet carries a debt-to-equity of 164.3 with a rising trend, and the quality score of 33/100 is among the weakest in the peer set. Recent renewable capacity additions (600 MW wind-solar hybrid PPAs signed in April 2026) signal a strategic pivot, but margin compression in Q4 alongside growing debt are the dominant structural themes.
P/E
15.5
Forward P/E
12.6
ROE
+12.6%
Debt / Equity
164.31
Profit Margin
+8.2%
Div. Yield
+3.3%
5Y ROE > 15%
0/5
5Y FCF > 0
4/5
Quality
49/100
News
8 headlines · 5 positive · 0 negative
CESC Ltd stock (INE124B01018): Profit up 13% in FY26 on renewable push, debt rises - AD HOC NEWS
AD HOC NEWS
CESC Q4 profit rises 17% to ₹439 crore, but margins shrink - CNBC TV18
CNBC TV18
CESC Signs Long-Term PPAs with Four Developers for 600 MW Wind-Solar Hybrid Power - Energetica India Magazine
Energetica India Magazine
CESC Signs PPAs For 600 MW Wind-Solar Hybrid Projects With Subsidiary Contributing Half - scanx.trade
scanx.trade
Brokerages see up to 24% upside for CESC after strong Q4 - MSN
MSN
Recent context
- ·Q4 FY26 net profit rose 17% year-on-year to ₹439 crore (CNBC TV18, May 2026), but margin shrinkage in the same quarter prompted mixed interpretations across brokerages on the sustainability of the profit trajectory.
- ·CESC signed long-term PPAs for 600 MW of wind-solar hybrid capacity with four developers in April 2026, with a subsidiary contributing half — the first visible step in a renewable capacity build-out that management has flagged as a strategic priority.
- ·Multiple brokerages cited upside potential of up to 24% following the Q4 result (MSN, May 2026); the mean analyst rating stands at 1.33 across 12 analysts on a 1–5 scale where lower values are more constructive.
Strengths
- +Lowest trailing PE (15.5) and forward PE (12.6) in the six-stock power peer group, suggesting the market prices CESC at a discount to sector peers such as POWERGRID (19.6x) and NTPC (21.9x).
- +Earnings growth of 17.8% over five years combined with FCF positive in 4 of the measured years indicates the core utility business has generated cash even as leverage has risen.
- +Dividend yield of 3.33% provides a returns floor that is above the typical large-cap power utility median, compensating partially for the below-sector ROE.
- +Price is above both the 50-DMA (₹167.2) and 200-DMA (₹163.8) with a 52-week drawdown of only 11.94%, and RSI at 52.3 is in neutral territory — no extreme reading in either direction.
Weaknesses
- −D/E of 164.3 is the primary structural concern: for a non-bank regulated utility this level of leverage, combined with a rising debt trend, leaves limited headroom if tariff revisions or regulatory outcomes disappoint.
- −ROE of 12.55% has not exceeded 15% in any measured year (roeYearsAbove15 = 0), and quality and consistency scores of 33 and 23 out of 100 respectively indicate capital productivity is persistently below what the sector median warrants.
- −Profit margin of 8.15% is thin, and Q4 FY26 results showed margin compression alongside the profit increase — revenue growth is not translating proportionally into profitability improvement.
- −Quality score of 33/100 ranks 3rd of 6 in the power peer set (below ADANIPOWER at 41 and POWERGRID at 39), flagging relative weakness in fundamental quality despite the PE discount.
Open questions
- ?Does CESC's rising debt trajectory reflect deliberate capital allocation toward renewable capacity, or does it indicate stress in the regulated distribution business that is being funded through borrowing?
- ?Can the 17.8% five-year earnings CAGR be sustained if margin compression continues, or is it dependent on tariff hikes that are outside management's direct control?
- ?How does CESC's 600 MW renewable PPA pipeline compare in scale and timeline to peers such as NTPC and ADANIGREEN, and what does the debt profile of those projects imply for the consolidated balance sheet?
- ?Given the PE discount to sector peers, does the gap reflect a justified risk premium for the leverage and quality scores, or does it represent a valuation anomaly worth investigating further?
Peer comparison: Power
Ranks 3 of 6 on quality| Symbol | Name | P/E | ROE | Quality |
|---|---|---|---|---|
| CESC | CESC Ltd.You're viewing | 15.5 | +12.6% | 33 |
| Industry avg | across 5 peers | 57.6 | +13.7% | 32 |
| ADANIPOWER | Adani Power Ltd. | 33.4 | +20.9% | 41 |
| POWERGRID | Power Grid Corporation of India Ltd. | 19.6 | +16.5% | 39 |
| NTPC | NTPC Ltd. | 21.9 | — | 31 |
| ADANIGREEN | Adani Green Energy Ltd. | 142.9 | +7.6% | 28 |
| ADANIENSOL | Adani Energy Solutions Ltd. | 69.9 | +9.7% | 23 |
Technical state
Current price
₹180.09
SMA 50
₹167.20
SMA 200
₹163.79
RSI (14)
52.3 (neutral)
From 52w high
-11.9%
1Y return
+13.5%
3M return
+15.5%
50-DMA
Above
200-DMA
Above
Algorithmic support levels
Algorithmic resistance levels
Risk flags
- highDebt-to-equity of 164.3 is extremely elevated for a non-bank power utility, and the debt trend is classified as rising. A consistency score of 23/100 alongside this leverage level means any tariff revision, regulatory cap, or earnings shortfall carries amplified balance-sheet risk.
- mediumROE of 12.55% has not crossed 15% in any of the measured years (roeYearsAbove15 = 0). Quality score of 33/100 and consistency score of 23/100 indicate capital productivity has been persistently sub-threshold for a capital-intensive utility.
- mediumProfit margin of 8.15% is thin, and Q4 FY26 results showed margin compression even as net profit rose 17% year-on-year, pointing to cost or revenue-mix pressures that are partially offset by volume or tariff tailwinds rather than structural efficiency gains.
- mediumPeer relative-value data is materially incomplete: priceChange1Y is null for all 5 listed peers, and ROE is null for 2 of 5. CESC ranks 1st on PE (lowest at 15.5 vs sector peers ranging 19.6 to 142.9), but the data gaps reduce confidence in cross-peer quality and return comparisons.
- lowNews sample totals 8 articles, which is sparse for a utility of this size. Sentiment skews positive (5 positive, 3 neutral, 0 negative), but the small sample limits how much weight the positive tone should carry.
Cross-section contradictions
- D/E of 164.3 is rising and the stock carries the weakest quality score among peers with available data, yet price is up 13.47% over 1 year and 15.49% over 3 months, trading above both the 50-DMA (₹167.2) and 200-DMA (₹163.8) — price momentum and balance-sheet trajectory are pointing in opposite directions.
- Q4 FY26 net profit rose 17% year-on-year to ₹439 crore while margins simultaneously shrank, suggesting volume or tariff-driven top-line growth is masking underlying cost pressures rather than reflecting broad-based profitability improvement.
For informational purposes only. Not investment advice. VivaTrades is not a SEBI-registered Investment Adviser or Research Analyst. Market data sourced from public feeds; consult a registered adviser before any investment decision.
Fundamentals & technicals: refreshed 25 Jun 2026 · refreshed daily at 01:00 IST
AI synthesis (narrative, snapshot, strengths/weaknesses, peer ranking): generated 17 May 2026 · rotates through NIFTY 500 every ~5 days