Adani Power Limited

Utilities — Utilities - Independent Power Producers · NSE

₹195.85−₹0.65 (−0.33%)

DalalBaazaar Score

59 / 100

🟡 Moderate

Verdict

NEUTRAL

Risk

Moderate

Driven by moderate debt load, negative free cash flow.

In simple words: Strong business and financial position, with both sales and profits growing well. Cash generation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:09 pm

Mixed / neutral. No major red flags jump out, but nothing here screams "obviously cheap" either. This is a name that needs a peer comparison and a view on near-term earnings triggers before sizing a position.

Understanding the Business

Company site ↗

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

What does this company do?

Adani Power Limited engages in the generation, transmission, and sale of electricity under long term power purchase agreements (PPAs), supplemental PPAs, medium and short term PPAs, and on merchant basis in India.

IndustryUtilities - Independent Power Producers

SectorUtilities

Employees3,967

Annual revenue₹54,152 Cr

How does it make money?

Turns over ₹54,152 Cr a year. Of every ₹100 of sales, about ₹24 reaches shareholders as profit, with ₹42 left at the operating level before interest, tax and depreciation. Each of its 3,967 employees supports ₹13.65 Cr of revenue a year, the signature of a capital- or asset-led business.

EBITDA margin42.4%

Net margin23.7%

Revenue / employee₹13.65 Cr

Who are its competitors?

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

NTPC LTDP/E 11.0x · ROE 13.7%

POWER GRID CORP. LTD.P/E 14.6x · ROE 15.8%

TATA POWER CO LTDP/E 29.3x · ROE 9.8%

What is its competitive advantage?Some evidence

ROCE of 15.1% is above what capital typically costs, which suggests some pricing power, though not yet the sustained, wide gap that marks a durable advantage.

ROCE15.1%

ROE19.8%

Peer median ROE13.7%

What is the outlook?

12 analysts covering the stock expect revenue to grow about 14.6% and earnings to grow about 17.9% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+14.6%

Est. earnings growth+17.9%

Analysts12

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 +42% while net margin moved -16% 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+42%

Margin effect-16%

DalalBaazaar Score

59/ 100

Moderate

Weighted across six categories. Every point is explained below.

• P/E of 26.5x already prices in growth
✗ P/E is 22% above its own historical median of 21.7x — expensive by its own standards
✗ P/B of 5.82x is a steep premium to book

Quality vs. Valuation

Company Quality

63/ 100

Average

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

Valuation

30/ 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

26.5x

3Y Median

21.7x

40 monthly readings · mean 20.7x · range 9.3x–37.7x

Sector Median

14.6x

median of 3 sector peers

⚠️Current valuation is approximately 22% above its 3y median of 21.7x. Paying more than usual needs a reason — faster growth, a better balance sheet, or a re-rating you believe in.

⚠️Against its sector it trades 81% above the peer median of 14.6x.

vs. its own history

Expensive

21.7x median over 40 months · +22%

vs. sector peers

Expensive

14.6x median of 3 peers · +81%

vs. generic bands

Fair

15x–35x

P/E (Trailing)

26.5x

P/B

5.82x

EV/EBITDA

18.8x

PEG

4.30

Dividend Yield

None

What's Good / What's Bad

🟢 What's Going Well2

Margins are improving
EBITDA margin is up from 34.4% to 42.4% over 3 years.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention4

Debt is rising
Total debt is up 29% over 3 years — worth checking what it funded.
Free cash flow is negative
The business is not currently covering its capital spending from operations.
Return on equity is falling
ROE has dropped from 35.9% to 19.8% — each rupee of shareholder capital earns less than it did.
Valuation above its historical average
At 26.5x the stock trades 22% above its own median of 21.7x.

Red Flags

2 items require attention · 2 watch

🟡Debt is increasingFinancial
Total debt is up 29% over 3 years.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹2,836 Cr in the latest year.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from 34.4% to 42.4%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
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?

The price already assumes success
The stock trades 22% above its own median multiple. At this level the business has to deliver just to stand still, and a stumble is repriced twice — lower earnings on a lower multiple.
Returns on shareholder capital are falling
ROE has dropped from 35.9% to 19.8%. Each rupee of equity earns less than it did, so profit growth increasingly depends on raising more capital rather than on the existing base working harder.

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

1Revenue growth stays above 9% a year✓ 12.5% CAGR
Latest reported year was 34.0%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 40%✓ 42.4%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Debt / EBITDA stays below 2x✗ 2.4x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
4Free cash flow remains positive✗ -₹2,836 Cr
Profit that never becomes cash eventually stops being profit.
5ROCE stays above 12%✓ 15.1%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

10 / 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

6 good · 3 neutral · 2 weak

Market Cap

₹3.78 L Cr

Large Cap

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

P/E (Trailing)

26.5x

Fair

Fairly valued against the generic band

P/B Ratio

5.82x

Rich

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

EPS (TTM)

₹7.39

Profitable

Profitable on a per-share basis

ROE

19.8%

Strong

Strong capital efficiency

ROCE

15.1%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.82x

Moderate

Moderate leverage

Revenue Growth (YoY)

34.0%

Healthy

Healthy top-line growth

Profit Growth (YoY)

44.4%

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

-₹2,836 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

CMP

₹195.85

P/E (Forward)

24.7x

Improving

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

Operating Margin

35.9%

Good

Healthy core-business profitability

Net Margin

24.1%

Good

Strong bottom-line conversion

Current Ratio

1.41

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.44

Defensive

Steadier than the market

52W Range Position

54%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

197.8 / 203.3

Bearish alignment (short < long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

44.1

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹38,023 Cr	₹50,051 Cr	₹56,132 Cr	₹54,152 Cr	+12.5%
EBITDA	₹13,092 Cr	₹27,585 Cr	₹23,940 Cr	₹22,964 Cr	+20.6%
EBITDA Margin	34.4%	55.1%	42.6%	42.4%	—
PAT (Net Profit)	₹10,727 Cr	₹20,829 Cr	₹12,939 Cr	₹12,834 Cr	+6.2%
EPS	₹4.91	₹10.32	₹6.46	₹6.62	+10.4%
ROE	35.9%	48.3%	23.0%	19.8%	—
ROCE	15.7%	31.2%	20.1%	15.1%	—
Total Debt	₹42,181 Cr	₹34,431 Cr	₹39,356 Cr	₹54,519 Cr	+8.9%
Free Cash Flow	₹5,187 Cr	₹11,568 Cr	₹9,942 Cr	-₹2,836 Cr	—

🟢 Revenue has grown at 12.5% a year over 3 years.

🟢 EBITDA has grown at 20.6% a year over 3 years.

🟢 EBITDA Margin has risen from 34.4% to 42.4% over 3 years (+8.0 pts).

🟢 PAT (Net Profit) has grown at 6.2% a year over 3 years.

🟢 EPS has grown at 10.4% a year over 3 years.

🔴 ROE has fallen from 35.9% to 19.8% over 3 years (-16.1 pts).

🟡 ROCE has held roughly flat at 15.1% over 3 years.

🔴 Total Debt has grown at 8.9% a year over 3 years.

🔴 Free Cash Flow has turned negative, from ₹5,187 Cr to -₹2,836 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹1.42 L Cr

Total Liabilities

₹75,878 Cr

Total Debt

₹54,519 Cr

Cash & Equivalents

₹883 Cr

Operating Cash Flow

₹20,514 Cr

Capex

-₹23,350 Cr

Shareholding (proxy)

Institutional Holding

18.2%

Insider Holding

71.7%

Corporate Actions

Next Earnings

23 Oct 2026

Analyst Consensus

Recommendations

9 Buy · 2 Hold · 0 Sell

Target Price (Mean)

₹250.27

+27.8% vs CMP

Target Range

₹220 – ₹282

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%

Recent News

3 mixed1 negative2 general

Adani Power revises disclosure for pledge of Jaiprakash Power shares

scanx.trade, 18 OctOwnership

🔴Potentially negativePromoter selling or pledging is a signal worth understanding, though the reason is often personal rather than about the business.

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.

Vedanta Power vs Tata Power vs Adani Power: Which Stock Is the Ultimate Winner in Power Stock Battle?

Goodreturns, 16 Oct

Market Trading Guide: Adani Power among 2 stock recommendations for Friday

The Economic Times, 15 Oct

Adani Power Signs 770 MW Bhutan Hydro Pact; Shares Rise 1.44%

HDFC Sky, 06 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 Power shares crash over 6%, down for second consecutive session - What tech charts signal? Experts decode

TradingView, 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.

Watch Items

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

DalalBaazaar Thesis

🟢Business QualityStrong15.8/20

🟡Financial HealthAdequate12/20

🟡GrowthModest9.3/20

🟢ProfitabilityStrong10.2/15

🔴ValuationDemanding4.5/15

🟢RiskLow6.7/10

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.

This thesis breaks if

✓Revenue growth stays above 9% a year12.5% CAGR
✓EBITDA margin holds above 40%42.4%
✗Debt / EBITDA stays below 2x2.4x
✗Free cash flow remains positive-₹2,836 Cr
✓ROCE stays above 12%15.1%