Q1 revenue from IPP division was 16% or 19.5 cr. if we divide that by the no of units 3.89 cr then we get per unit revenue of 5 rs. consider the long term picture. IPP is annuity revenue i.e. PPA are signed for 15 years. by 2025, the co. plans to energise 250MW of IPP and that will give 200 cr annual revenue. approval of this capacity is not an issue as cumulatively they have 320+MW approval already in hand. although the co. has not mentioned the CPP capacity energised in Q1FY23, but revenue wise it is 100 cr (122 cr ttl -20 cr from IPP).
Currently, per MW cost of setting up a solar project is 4-5 cr. If i take 4 cr then co energised close to 25 MW of CPP capacity in this quarter. the 4-5 cr figure is also confirmed by the recent credit rating report from ICRA. they state that 350 cr of CPP will be executed in 6-9 months and the orderbook as per latest Investor presentation is 84MW under CPP. 350/84 will give per MW cost at 4.2 cr (in the 4-5 cr range)
The cumulative capacity is 100 MW and by end of FY22 it will be close to200 MW (100+84). this would mean that co needs to execute 550 MW in next 2 years to reach the target of 750MW by 2025. If i just avg capacity of 350MW per year then it would mean revenue of 1400 cr (350*4) annually from CPP.
So the total revenue if all executed as per current targets would be in range of 1600 cr in FY2025. at 20% profit, it means NPM of 320 cr or EPS of 178. At that stage i am expecting significant rerating in the PE ratio but still using a PE of 25, the price should be 4450 or 5 times from current levels.
Another interesting thing which might have escaped notice is the fact that they have now ventured in wind power also. infact i know a co called pashupati cotspin which recently confirmed 2MW order under CPP which is a solar+wind hybrid model. gujarat is currently 2nd in terms of installed wind capacity across India after Tamil nadu and it has huge potential. If this segment takes off for KPI green, then we could be looking at another stream of revenue in next 2-3 years.