Adani Power emerges as India's largest private thermal power producer, set to triple earnings by 2033: Morgan Stanley

New Delhi [India], September 19 (ANI): Adani Power Limited (APL) has firmly established itself as India’s largest private coal-based independent power producer (IPP), with a portfolio of 18,150 MW spread across 12 plants in eight states, according to a research report by Morgan Stanley.

APL has successfully acquired and turned around 4,370 MW of stressed assets, with integration of another 2,900 MW underway. The private power producer has consistently maintained plant availability above 90 per cent, backed by digital operations and in-house coal sourcing and logistics expertise.

The company has emerged as a formidable coal franchise, holding an 8 per cent share in India’s coal capacity and generation, second only to NTPC. The report says, APL’s market share is projected to rise to 15 per cent by FY32, supported by a capacity pipeline of 41.9 GW – 2.5 times its current portfolio.

“We forecast its market share to reach 15 per cent by F32e with a 41.9GW portfolio (2.5x vs F25). APL has seen favourable resolution of most regulatory issues and has a strong balance sheet” said the report

The report says, APL has demonstrated a strong track record in reviving distressed assets. For instance, the 1,370 MW Raipur plant, acquired in 2019, saw EBITDA grow twelvefold from Rs 2.1 billion to Rs 24 billion in FY25. Similarly, the 1,200 MW Mahan plant, bought in 2022, quadrupled EBITDA to Rs 19 billion in three years, with debt fully prepaid. The Raigarh plant, once non-operational, now delivers Rs 12.7 billion EBITDA annually.

Recent acquisitions of FY25, including Mutiara (1,200 MW), Korba (600 MW), Butibori (600 MW), and Dahanu (500 MW), are expected to contribute meaningfully to earnings over FY26 to FY27.

The report adds that APLs financials have seen a dramatic improvement, with net debt-to-EBITDA falling from 9.7x in FY19 to 1.8x in FY25, aided by recovery of regulatory dues and favourable resolutions of legacy issues.

The company has showcased rapid execution capabilities, completing India’s largest supercritical plant at Mundra (4,620 MW) in record time and commissioning the Godda transnational plant during the pandemic within 3.5 years.

Most regulatory issues have been resolved favourably. The Supreme Court has disposed of allegations raised in a short-seller report, while on Thursday, market regulator SEBI also gave a clean shit to the Adani group.

Morgan Stanley has initiated coverage on Adani Power with an ‘Overweight’ rating and a price target of Rs 818, implying 30 per cent upside. It forecasts that APL’s capacity and EBITDA will rise 2.5x and 3x respectively by FY33. (ANI)

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