Adani Power Share Price Jumps 35% in Q1 on Strong Earnings

Adani Power Ltd is set to reveal its earnings for the June quarter on July 31. The stock saw a remarkable increase of over 35% in the first quarter, making investors eagerly anticipate the results, especially after the weak earnings reported in the March quarter. 

As of 10:35 AM (IST) on Tuesday, Adani Power share price increased by 1.81%, reaching ₹729.75, while the benchmark Nifty stood at 24875.85, showing a rise of 39.75 points.

Currently, there is no analyst coverage on the stock, leading to an absence of buy, hold, or sell ratings. The company's market capitalization stands at ₹2.76 lakh crore.

In the fourth quarter, Adani Power reported a significant 48% year-over-year decline in net profit, which fell to ₹2,737 crore. However, total income rose to ₹13,881.52 crore from ₹10,795.32 crore. For the fiscal year 2024, net profit almost doubled to ₹20,828.79 crore from ₹10,726.64 crore in the previous fiscal year.

The company's expenses in Q4 increased to ₹10,323.58 crore from ₹9,897.60 crore. Revenue from operations jumped 30% to ₹13,363.69 crore from ₹10,242.06 crore in the same quarter last year. The fiscal year 2024 revenue was ₹60,281 crore, a 40% increase from ₹43,041 crore in fiscal year 2023.

Adani Power currently operates a thermal power capacity of 15.25 gigawatts (GW). According to a recent report, Adani Energy Solutions plans to transfer the Dahanu asset to Adani Power. In its FY24 annual report, Adani Energy outlined its intention to divest the 500 MW Dahanu generation unit, which is a legacy asset from the Mumbai power distribution business acquired from Anil Ambani's Reliance Infrastructure in 2018.

Looking ahead, investors will be monitoring updates on Adani Power's expansion strategies. With rising power demand in India and government mandates for fuel supply to thermal plants, Adani Power is well-positioned for long-term demand, as noted in the company's latest analyst call. The company plans to focus on brownfield expansions, adopting ultra-supercritical technology, and pursuing inorganic growth opportunities.

India's power demand is expected to hit 260 gigawatts this summer, driven by economic growth. Despite the rise of renewables, thermal power remains essential. The government has assured fuel supply and increased projections for new thermal installations from 50 gigawatts to over 80 gigawatts, according to Adani Power.

Adani Power aims to boost its generation capacity to over 24 gigawatts by leveraging growth and inorganic opportunities, thereby enhancing stakeholder value.

Adani Energy Solutions (AESL), which handles power transmission and distribution, plans to divest the Dahanu power plant to Adani Power. Last week, AESL announced that, in line with its environmental, social, and governance (ESG) commitments, it would divest the Dahanu thermal plant. An email query sent to the company last Friday remained unanswered.

In its FY24 annual report, Adani Energy reiterated its plans to separate the Dahanu asset during the current financial year. The 500 MW unit is a legacy asset from the Mumbai power distribution business that Adani Energy acquired from Anil Ambani's Reliance Infrastructure in 2018.