Adani Power ups capacity target to 45 GW, cuts capex, changes Bangladesh receivable story
Record Q1 with PAT up 47% masks three inconsistencies: expansion target raised without rationale, capex cut 8% without explanation, and Bangladesh receivables now all revenue despite earlier dispute process.
What's new
- Continuing revenue ₹17,936 cr, up 27% YoY; continuing EBITDA ₹6,983 cr, up 22%; PAT ₹4,867 cr, up 47%.
- Capacity expansion target raised from 42 GW to 45 GW by FY31-32 with no added rationale.
- FY27 capex guidance reduced to ~₹23,000 cr from ~₹25,000 cr, though capex program unchanged.
- Bangladesh receivables near $400 mn; all invoiced amounts recognized as revenue, no portion considered disputed.
Themes from the call
Demand
India peak demand hit 250 GW in May 2026; Adani Power PLF rose to 78% from 67% with generation up to 31 bn units.
Margins
Continuing EBITDA margin roughly 39%; higher dispatch and PPA mix offset fuel cost rise of 30% to ₹9,513 cr.
Capital allocation
Capex of ~₹23,000 cr in FY27, >₹30,000 cr in FY28; net debt/EBITDA expected 2.0-3.0x; surplus reinvested, no dividends or QIP scheduled.
Guidance watch
- 45 GW target by FY31-32 reaffirmed; additional 3 GW planned for state bids.
- Korba Phase 2 (1,320 MW) to commission before end-Dec 2026; PPA tie-up within FY27.
- Mahan Phase 2 first unit expected Q1 FY28, second unit Q2 FY28.
- Capex: ~₹23,000 cr FY27, >₹30,000 cr FY28, ₹33,000-35,000 cr thereafter.
- Net debt/EBITDA to remain 2.0-3.0x, not exceed 3.0x.
- Nuclear ~10 GW by 2035, but execution waits for government rules; at least 5 years away.
- Bangladesh monthly collections expected ~$100 mn, receivables improving.
Risk flags
- Expansion target raised without incremental execution or funding detail raises credibility of growth plan.
- Capex cut despite 'no change in program' unexplained; may signal execution or funding constraints.
- Bangladesh receivable characterization reversal – from potentially disputed to all revenue – needs reconciliation to assess true collectability risk.
- 56% of upcoming capacity under long-term PPAs; remainder exposed to merchant price volatility.
- Nuclear and Bhutan hydro optionality highly dependent on regulatory and contractual outcomes; no concrete timeline.
Key quotes
-
"Our target is 45 gigawatts now. It was revised from 42 gigawatts to 45 gigawatts, and we are confident we will achieve it."
— Adani Power management, July 2026 call -
"We do not expect it to cross 3 at any point. We will run between 2 and 3 over the period."
— Dilip Sha, CFO, on net debt/EBITDA
The brief
Adani Power delivered a record Q1 — continuing revenue up 27% to ₹17,936 crore, PAT up 47% to ₹4,867 crore, and PLF jumping to 78% from 67%. Thermal baseload demand is surging, and the company is adding contracted capacity fast. That is the good news.
The bad news is a pattern of unexplained guidance changes. The expansion target was lifted from 42 GW to 45 GW on the same timeline, but management gave no new rationale or funding plan. At the same time, FY27 capex guidance was cut by about 8% to ₹23,000 crore, while insisting the program hasn't changed. The two statements are in tension.
Then there is Bangladesh. In April, management described a dispute-resolution process with an expert and possible arbitration. In July, they said no portion is disputed and all invoiced amounts are revenue. The numbers — $400 million in receivables, $100 million monthly collections — are unchanged, but the risk characterization has flipped.
None of these contradictions were explained on the call. They don't invalidate the strong operating quarter, but they make it harder to underwrite management's forward targets without more clarity.
Adani Power's numbers are strong, but its guidance credibility has three question marks – and management didn't address any of them.