CESC Subsidiary To Fully Acquire Deshraj Solar Energy

Purvah Green Power Pvt., a subsidiary of CESC Ltd., entered into a share purchase agreement on Monday to acquire a 100% share capital of Deshraj Solar Energy Pvt. on a fully diluted basis.

Deshraj Solar Energy will become a step-down subsidiary of Purvah Green Power after the acquisition. The acquisition, which is to be completed within two days, is being done with an aim to expand the renewable energy business, according to an exchange filing.

Deshraj Solar Energy is involved in the development of a solar photovoltaic power plant of 300-megawatt capacity in India.

On Oct. 10, Purvah Green Power incorporated JSK Renewable Energy Pvt., a wholly owned subsidiary.

CESC announced on Oct. 3 that it would acquire the entire shareholding of Bhojraj Renewables Energy Pvt. from its shareholders on a fully diluted basis. The step-down subsidiary had signed a binding term sheet with Bhojraj Renewables for the development of a 150 MW solar project and a 300 MW wind project.

The acquisition will take nine months to complete and took place for a cash consideration of Rs 108.6 crore. This consideration was on the condition upon the successful fulfilment of certain project-related milestones within designated timelines.

The share price of CESC closed 0.26% lower at Rs 187.48 apiece on the NSE, compared to a 0.66% uptick in the benchmark Nifty 50. The stock has risen 41.49% on a year-to-date basis and 113.29% over the past 12 months.

Out of the 13 analysts tracking the company, 11 have a 'buy' rating on the stock, one suggests a 'hold' and another recommends a 'sell', according to Bloomberg data. The average of 12-month analysts' consensus price targets implies a potential upside of 8.5%.