Synopsis: JSW Energy Ltd’s shares are in the spotlight following the Buy target of ₹ 657 by a leading brokerage firm, Motilal Oswal, as they unlock new Growth Avenues, Strong Growth Outlook, and valuation is a buying opportunity with an upside of upto 33%.
The shares of the JSW Group company, specializing in the business of generating power from its power assets located in Karnataka, Maharashtra, Nandyal, and Salboni, are in focus after the leading Brokerage firm Motilal Oswal initiated a Buy Target with an upside potential of 32 percent.
With a market capitalization of Rs. 86,042 Crores on Friday, the shares of JSW Energy Ltd rose upto 2 percent, reaching a high of Rs. 502.65 compared to its previous closing price of Rs. 494.60.
What Happened
JSW Energy Ltd, engaged in the business of generating power from its power assets located in Karnataka, Maharashtra, Nandyal, and Salboni, is in focus after a leading Brokerage firm, Motilal Oswal, initiated a Buy target of Rs. 657 with an upto 33 percent Upside Potential from yesterday’s close price.
Reason for the Buy Target
Unlocking New Growth Avenues
JSW Energy showcased its green hydrogen and floating solar initiatives during the Vijaynagar plant visit during 7-8th January. These projects highlight the company’s focus on next-generation clean energy solutions and long-term sustainability.
The company has nearly doubled its operational capacity from 7.2 GW in FY24 to 13.2 GW in Q2 FY26, reflecting strong execution. With a 17.2 GW pipeline, ~74% tied to long-term PPAs, JSWE remains on track to reach 30 GW by FY30, ensuring cash-flow stability and growth visibility.
Green Hydrogen – Pilot Project at Vijaynagar
JSWE commissioned a 5,000 m³/hour green hydrogen plant in Nov’25 for captive use by JSW Steel. It is based on pressurised alkaline electrolyser technology. Electrolysers were supplied by Peric (60%+ global market share), and the plant is estimated to have a 20-year life. The plant runs on solar and wind power, operates on a cost-plus basis, and delivers mid-teen RoE.
Currently, green hydrogen costs Rs. 3.5–4/kg, with power accounting for 80–90% of expenses. Costs can fall to Rs. 2–2.5/kg if power cost reduces to Rs. 1.8/unit, enabling mass commercialisation, and this project aligns with JSW Steel’s green steel ambitions.
Floating Solar – A Novel Energy Model
JSW Energy commissioned a 20 MW floating solar plant on September 25, built over a dam using interconnected floats and a mooring system, eliminating the need for land while enabling efficient power generation.
Although costs are ~10% higher than ground-mounted solar, natural cooling boosts output and limits degradation, keeping IRRs comparable and supporting future expansion of floating solar capacity.
Strong Growth Outlook
With a PPA-backed renewable pipeline and expanding clean energy portfolio, JSWE is poised for rapid growth. EBITDA and PAT are projected to grow at a CAGR of 49 percent and 31 percent, respectively, over FY25–28E.
Valuation & View
JSWE is valued using a SoTP approach: Thermal at 9x EBITDA, Renewables at 12x, Hydro at 2x book value, and Green Hydrogen at 2x book value. JSWE’s stake in JSW Steel is valued at a 25% discount to the current market price, acknowledging the strategic significance of this holding while incorporating a conservative valuation approach. This leads to a target price of Rs. 657, implying 32 percent upside, with a BUY recommendation backed by strong execution and future-ready energy investments.
Financials & Others
The company’s revenue rose by 60 percent from Rs. 3,238 crore in September 2024 to Rs. 5,177 crore in September 2025. Meanwhile, the Net profit declined from Rs. 877 crore to Rs. 824 crore during the same period.
The company delivers decent returns with an ROCE of 6.49 percent and an ROE of 7.41 percent, reflecting stable operational performance. It also maintains a healthy dividend payout of 19.7 percent, offering consistent value to shareholders.
In Q2 FY26, the company’s installed capacity reached 13.2 GW, with 443 MW of organic renewable capacity added during the quarter. This included 240 MW from Kutehr, 148 MW from wind, and 56 MW from solar projects.
The company has a locked-in generation capacity of 30.5 GW targeted by 2030, with a diversified mix comprising 30% thermal (9,058 MW), 23% hybrid (7,103 MW), 21% solar (6,511 MW), 20% wind (6,009 MW), and 6% hydro (1,781 MW), ensuring balanced and sustainable growth.
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