Shares of JSW Energy are set for a 16% upside after the power company engaged in power generation, transmission and trading, inked a definitive agreement for the acquisition of MCCPL’s 300 MW operational thermal power plant in Chhattisgarh. This will strengthen its thermal generation portfolio with a high-plan load factor asset backed by long-term PPAs, secured coal linkages and stable cash flows. 

Brokerage PL Capital assigned a price target of Rs 646 against the market price of Rs 559. 

Shares of JSW Energy ended 1% higher at Rs 565.20 today. Market cap of the firm stood at Rs 1.03 lakh crore. 

The acquisition has been completed at an enterprise value of around Rs 1410 crore, translating to approximately Rs 47 million per MW and an FY26 EV/EBITDA multiple of nearly 5.1 times. The deal is expected to be earnings accretive from the outset and will increase JSW Energy's operational power generation capacity by about 2% to nearly 13.9 GW.

The acquisition also marginally raises the company's exposure to the merchant power market, potentially enabling it to benefit from favourable electricity market dynamics. Incorporating the contribution from MCCPL, the brokerage has increased its EBITDA estimates for FY27 and FY28 by roughly 2%.

Additionally, the estimates factor in a Rs 40 billion qualified institutional placement (QIP) conducted at Rs 525 per share, resulting in an equity dilution of around 4%. The brokerage has maintained its 'Buy' recommendation on the stock. 

The acquisition will raise JSW Energy’s operational generation capacity by 300 MW, taking the operational portfolio to approximately 13.9 GW. Thermal installed capacity will rise from 5.7 GW to 6.0 GW, strengthening the company’s thermal generation footprint. Merchant exposure will rise modestly from around 4.0% to 4.7% of the generation portfolio due to MCCPL’s untied capacity.

Acquisition Value & Earnings Contribution 

JSW Energy is acquiring MCCPL at an enterprise value of Rs 14.1 bn, implying an attractive valuation of approximately Rs 47 mn per MW. The asset generated FY26 revenue of Rs 790 crore and EBITDA of nearly Rs 280 crore, translating into an EV/EBITDA multiple of nearly 5.1 times. Based on FY26 performance, the acquisition is expected to contribute roughly 4% to JSW Energy’s revenue and 3% to EBITDA, while being earnings-accretive from the first year of consolidation. "Incorporating MCCPL into our estimates increases FY27E/FY28E by EBITDA by ~2%, PAT by ~1% for FY27E/28E and EPS cut factors dilution post QIP," said the brokerage. 

About MCCPL

Maruti Clean Coal & Power Limited (MCCPL) owns and operates a 300 MW coal-fired thermal power plant located in Korba, Chhattisgarh. Incorporated in 1999, the company has been operating the asset since its commercial commissioning in July 2015.