Jefferies sees Adani Ent an attractive play on capex theme, starts coverage with 19% upside

Jefferies has set a target price of Rs 3800 on the Adani Enterprises stock, citing key triggers such as the commissioning of Navi Mumbai Airport and green hydrogen manufacturing units

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26 Aug, 2025 12:21

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Foreign broking firm Jefferies on February 13 initiated coverage on Adani Enterprises with a 'buy' tag, projecting doubling of EBITDA by FY26 to Rs 21,449 crore. It has set a target price of Rs 3,800 on the stock, citing key triggers such as the commissioning of the Navi Mumbai Airport and green hydrogen manufacturing units.

Jefferies' target price indicates a 19 percent upside from the last closing price of Rs 3,180.

Despite potential risks such as project delays and leverage issues, Jefferies remains optimistic about the growth and investment potential in Adani Enterprises.

Also Read: Moody's revises ratings outlook on 4 Adani Group firms

The broking firm has noted in its recent report that Adani Enterprises, since inception, incubated and unlocked value in self-sustaining businesses such as ports, power, city gas distribution, transmission, and FMCG.

"It is now building new businesses in airports, new energy/ Green Hydrogen (GH2), data centre, roads, and copper, some of which will also likely find their way to demergers (value unlocking) over the next decade," Jefferies said.

Citing the airports business, it added that Adani Airports commands a substantial 23 percent share of passenger traffic in India, overseeing operations at eight airports, including the soon-to-be-commissioned Navi Mumbai Airport (NMIAL).

For further building these new businesses, the company will invest $5-7 billion capex annually over FY24-28 and the balance sheet is ripe to undertake capex again, believes the broking firm as net debt/EBITDA has come down to 3.2x in FY23 from 6x+ average in FY14-18.

"While net debt/EBITDA may again touch 6x in near term, we believe fund-raising opportunities at the business level may partly assuage it," the report said.

Also Read: Review filed against SC’s judgment on Adani-Hindenburg issue

Thus, Jefferies expects Adani Enterprises' EBITDA to double from FY23 to FY26 and grow over three times by FY28. The contribution of new businesses will scale from 40 percent of consolidated EBITDA to ~75 percent by FY26 and 85 percent by FY28.

In sum-of-the-parts enterprise value mix, the brokerage has attributed 33 percent to airport, 53 percent to ANIL (Adani New Industries Limited), 4 percent to mining, 4 percent to roads, 3 percent to data center and 3 percent to 3 percent to mining.

At current market price, the stock is trading at 28x/22x FY25/FY26E EV/EBITDA, Jefferies noted.

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