Adani Energy Solutions Limited

Utilities — Utilities - Independent Power Producers · NSE

₹1,365.90+₹11.70 (+0.86%)

DalalBaazaar Score

51 / 100

🟡 Moderate

Verdict

CAUTION

Risk

High

Driven by high debt relative to equity, negative free cash flow, a very high earnings multiple, which leaves little margin for disappointment.

In simple words: Reasonable but unspectacular business quality, with both sales and profits growing well. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:01 pm

Understanding the Business

Company site ↗

The 60-second version of Adani Energy Solutions Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Adani Energy Solutions Limited, together with its subsidiaries, generates, transmits, and distributes power in India. It operates through the Transmission; Distribution; Smart Meter; Trading; and Others segments.

IndustryUtilities - Independent Power Producers

SectorUtilities

Employees3,514

Annual revenue₹27,203 Cr

How does it make money?

Turns over ₹27,203 Cr a year. Of every ₹100 of sales, about ₹8 reaches shareholders as profit, with ₹31 left at the operating level before interest, tax and depreciation. Each of its 3,514 employees supports ₹7.74 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹7.74 Cr

Who are its competitors?

The closest listed comparisons in its industry are NTPC LTD, POWER GRID CORP. LTD., TATA POWER CO LTD, ADANI POWER LTD. These are the companies its valuation and returns are measured against elsewhere in this report.

Compared side by side in Peers ↓

What is its competitive advantage?Little sign of one

Returns on capital of 8.4% are at or below what the capital likely costs. That is the financial pattern of a business competing largely on price, where advantage has to come from execution rather than position.

Peer median ROE15.8%

What is the outlook?

8 analysts covering the stock expect revenue to grow about 10.3% and earnings to grow about 17.3% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+10.3%

Est. earnings growth+17.3%

Analysts8

What has been driving growth?

Growth has come mainly from selling more, rather than from keeping more of each sale. Over 3 years revenue moved +108% while net margin moved -13% relative to itself. What this cannot tell you is which products, customers or geographies did the work — that lives in the segment disclosures of the annual report.

Revenue effect+108%

Margin effect-13%

DalalBaazaar Score

51/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Debt/Equity of 1.95x is high — earnings must service borrowings before shareholders see anything
• Current ratio of 1.15 covers short-term liabilities, without much slack
✗ Free cash flow is negative — growth is being funded by borrowing or fresh equity
✗ Interest cover of only 1.9x — little room if profits dip

Quality vs. Valuation

Company Quality

51/ 100

Average

How good the business is, ignoring the share price entirely.

Valuation

39/ 100

Expensive

What you are being asked to pay, ignoring how good the business is.

A reasonable business at a reasonable price — neither the quality nor the valuation stands out in either direction.

Historical Valuation

Current P/E

56.2x

3Y Median

94.2x

40 monthly readings · mean 96.4x · range 63.8x–181.8x

Sector Median

20.6x

median of 4 sector peers

🟢Current valuation is approximately 40% below its 3y median of 94.2x. Cheaper than its own history, which is worth a reason too: the market may be pricing in something the backward-looking numbers do not show.

⚠️Against its sector it trades 173% above the peer median of 20.6x.

vs. its own history

Cheap

94.2x median over 40 months · -40%

vs. sector peers

Expensive

20.6x median of 4 peers · +173%

vs. generic bands

Expensive

Above 35x

EV/EBITDA

25.8x

PEG

2.55

What's Good / What's Bad

🟢 What's Going Well1

Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention0

Nothing stands out as clearly deteriorating on the years of data available.

Red Flags

7 items require attention · 4 high · 3 watch

🔴High leverageFinancial
Debt/Equity of 1.95x — earnings must service borrowings before shareholders see anything.
🔴Thin interest coverageFinancial
Operating profit covers interest only 1.9x — little room if earnings dip.
🔴Significant margin compressionFinancial
EBITDA margin has fallen 15.6 points, from 46.2% to 30.6%.
🔴Inventory building faster than salesFinancial
Inventory up 341% against revenue up 108% — stock may not be moving.
🟡Debt is increasingFinancial
Total debt is up 43% over 3 years.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹3,435 Cr in the latest year.
🟡Receivables growing faster than salesFinancial
Receivables up 152% against revenue up 108% — sales are being booked faster than they are collected.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Priced below its own history
The stock trades 40% below its own median multiple. If the business performs as it has and simply re-rates back to normal, that gap is return on its own.
Earnings have proved durable
Profitable in every one of the last 4 reported years. Consistency lowers the risk that any single bad year is structural rather than cyclical.

🔴 Bear CaseWhat could go wrong?

Margins are being competed away
EBITDA margin has fallen from 46.2% to 30.6%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
The debt load needs earnings to hold up
Debt is 5.9x EBITDA. At that level a downturn in earnings turns a manageable balance sheet into a refinancing problem, and lenders get paid before shareholders.
Sales are being booked faster than collected
Receivables are up 152% against revenue up 108%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
A premium to the sector to defend
It trades 173% above the peer median. That premium needs a reason that persists, or it closes.
Several serious flags at once
4 high-severity checks triggered. Individually each has an explanation; together they raise the chance that something structural is wrong rather than a one-off.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1Revenue growth stays above 21% a year✓ 27.7% CAGR
Latest reported year was 42.4%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 29%✓ 30.6%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Debt / EBITDA falls below 3x✗ 5.9x
Already stretched, so this is a reduction target rather than a level to hold. Around 3x is where lenders typically start attaching conditions.
4Free cash flow remains positive✗ -₹3,435 Cr
Profit that never becomes cash eventually stops being profit.
5Interest cover stays above 3x✗ 1.9x
How much operating profit can fall before interest stops being comfortably covered.

Investment Checklist

5 / 12 checks passed

✗ Strong return on equity (ROE ≥ 15%)
✗ Strong return on capital employed (ROCE ≥ 15%)
✗ Healthy net margin (≥ 10%)
✗ Generates positive free cash flow
✗ Manageable leverage (Debt/Equity < 1.0)
✓ Adequate short-term liquidity (Current Ratio ≥ 1.0)
✓ Revenue growing year-over-year
✓ Profit growing year-over-year
✗ Not trading at an extreme valuation (P/E < 40x)
✓ Not buying right at the 52-week high
✓ Analyst consensus isn't majority-sell
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

4 good · 3 neutral · 4 weak

Market Cap

₹1.67 L Cr

Large Cap

Large, widely-covered business — typically the steadiest of the bands

P/E (Trailing)

56.2x

Expensive

Expensive — verify against sector peers

P/B Ratio

6.45x

Rich

Steep premium to book — needs high, durable returns to justify

EPS (TTM)

₹24.3

Profitable

Profitable on a per-share basis

ROE

9.0%

Moderate

Moderate capital efficiency

ROCE

8.4%

Moderate

Moderate return on the capital in the business

Debt/Equity

1.95x

High

High leverage

Revenue Growth (YoY)

42.4%

Healthy

Healthy top-line growth

Profit Growth (YoY)

124.1%

Healthy

Profits growing at a healthy clip

Dividend Yield

None

No dividend yield reported — usually means no payout, but verify if one was recently initiated

Free Cash Flow

-₹3,435 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

P/E (Forward)

38.0x

Improving

Below the trailing multiple — the street expects earnings to grow into the price

Operating Margin

25.0%

Good

Healthy core-business profitability

Net Margin

9.6%

Average

Average bottom-line conversion

Current Ratio

1.15

Adequate

Adequate, but no real cushion

Beta (vs Nifty)

0.66

Defensive

Steadier than the market

52W Range Position

57%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

1335.3 / 1436.2

Bearish alignment (short < long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

53.9

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹13,065 Cr	₹16,355 Cr	₹23,575 Cr	₹27,203 Cr	+27.7%
EBITDA	₹6,042 Cr	₹6,214 Cr	₹7,491 Cr	₹8,323 Cr	+11.3%
EBITDA Margin	46.2%	38.0%	31.8%	30.6%	—
PAT (Net Profit)	₹1,256 Cr	₹1,137 Cr	₹1,060 Cr	₹2,283 Cr	+22.0%
EPS	₹11.1	₹10.2	₹9.05	₹19	+19.6%
ROE	10.7%	9.0%	4.8%	9.0%	—
ROCE	9.5%	8.9%	6.6%	8.4%	—
Total Debt	₹34,270 Cr	₹37,070 Cr	₹39,926 Cr	₹49,176 Cr	+12.8%
Free Cash Flow	-₹925 Cr	₹608 Cr	-₹334 Cr	-₹3,435 Cr	—

🟢 Revenue has grown at 27.7% a year over 3 years.

🟢 EBITDA has grown at 11.3% a year over 3 years.

🔴 EBITDA Margin has fallen from 46.2% to 30.6% over 3 years (-15.6 pts).

🟢 PAT (Net Profit) has grown at 22.0% a year over 3 years.

🟢 EPS has grown at 19.6% a year over 3 years.

🔴 ROE has fallen from 10.7% to 9.0% over 3 years (-1.7 pts).

🔴 ROCE has fallen from 9.5% to 8.4% over 3 years (-1.1 pts).

🔴 Total Debt has grown at 12.8% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹92,835 Cr

Total Liabilities

₹66,309 Cr

Cash & Equivalents

₹1,735 Cr

Operating Cash Flow

₹10,997 Cr

Capex

-₹14,432 Cr

Shareholding (proxy)

Institutional Holding

22.7%

Insider Holding

73.4%

Corporate Actions

Next Earnings

22 Oct 2026

Analyst Consensus

Recommendations

6 Buy · 3 Hold · 0 Sell

Target Price (Mean)

₹1,716

+25.6% vs CMP

Target Range

₹1,434 – ₹2,060

Peer Comparison

Company	P/E	ROE
NTPC LTD	11.0x	13.7%
POWER GRID CORP. LTD.	14.6x	15.8%
TATA POWER CO LTD	29.3x	9.8%
ADANI POWER LTD	26.5x	21.9%

Recent News

4 mixed2 general

Adani Group stocks Q2 results 2026 date this week: Adani Green, Adani Energy, Adani Gas, Adani Power schedule, returns

Livemint, 18 OctResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

Adani Energy Solutions shares: Qatar Holding sells 48.05 lakh shares to Birla Mutual Fund

Goodreturns, 16 Oct

Adani Energy Solutions share price rally: From Rs.990 to Rs.1,350 in just 6 months: Know why the stock has surged 43%

TradingView, 05 OctPrice move

🟡Mixed / dependsA price move, which is not by itself a change in the business. Worth finding the cause before reading it as either good or bad.

Adani Energy Solutions Share Price Jumps 5% — What's Driving The Rally Today?

NDTV Profit, 01 OctPrice move

🟡Mixed / dependsA price move, which is not by itself a change in the business. Worth finding the cause before reading it as either good or bad.

Adani Energy Solutions (ADANIENSOL) Share Price Fall Streak: Second Straight Session Down

Univest, 08 OctPrice move

🟡Mixed / dependsA price move rather than a change in the business. If the figures on this page have not moved, the fall is either an opportunity or news they have yet to catch up with.

Adani Energy Solutions - Vedanta Power among 6 stocks showing RSI trending up

The Economic Times, 15 Oct

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

StrongGrowth

MiddlingBusiness Quality · Risk

WeakFinancial Health · Profitability · Valuation

Points for each in the Score ↑

Unremarkable in both directions

A reasonable business at a reasonable price. Nothing here is alarming and nothing is compelling, which usually means the decision rests on things this data cannot see — the industry's direction, management's intent, and what else is available to you. 4 high-severity red flags sit above this conclusion and should be read first.

3 of 5 tripwires tripped — Debt / EBITDA falls below 3x; Free cash flow remains positive; Interest cover stays above 3x · see Key things to watch ↑