Asit C Mehta report on Adani Power
Adani Power Ltd (APL) is India’s largest private thermal power producer, renowned for its critical role in meeting the country’s baseload electricity demand. Founded in 1996 and operating under the flagship Adani Group, the company has emerged as a key player in India’s energy sector, driving growth through strategic capacity expansion and efficient asset management. With a robust and diversified portfolio of power plants across India, Adani Power is recognized for its large-scale operations, advanced project execution capabilities, and consistent performance. Over the years, Adani Power has expanded its installed capacity to 17.55 GW with an additional 13.12 GW in the pipeline, targeting a total capacity of 30.67 GW by FY30. Its strategic focus on securing long-term Power Purchase Agreements (PPAs)—with over 87% of capacity tied up—and its ability to profitably participate in the merchant power market provide a stable revenue base. The company benefits from enhanced coal availability, strong logistics infrastructure, and operational synergies through vertical integration within the Adani Group.
Outlook
We forecast a revenue CAGR of 7.9% over FY25– FY27E, underpinned by increased generation volumes and stable tariff realization. Based on an EV/EBITDA multiple of 11.2x applied to FY27E estimates, we derive a target price of INR 680, and maintain an ACCUMULATE rating. This valuation reflects Adani Power’s enhanced business fundamentals, earnings stability, and its critical role in addressing India’s baseload power requirements.
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