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Kolkata: One of the electricity majors, Adani Power is pursuing expansion of generating capacity which is expected to reach an operational capacity of 30,670 MW by the year 2030. The company is in focus in the stock market too. In a recent report, Jefferies has expressed bullish sentiment on this stock, which is one of the prominent businesses of Gautam Adani.
Jefferies has also emphasised the rapid and steady addition to the generating capacity of the company. Between FY23 and FY25, the generating capacity of the company surged 29%. Its current capacity is 17.6 GW while the target is to add another 12.4 GW by 2030 -- or more than 70% in the next five years. “11.2 GW of equipment has already been ordered at competitive rates with BHEL, and over 3 GW is expected to be operational by the first half of FY28,” Jefferies mentioned in its report.
Jefferies has issues a “Buy” call with a target price of Rs 690, which represented 18% upside from the levels at that point. In early trade on July 10, the stock was trading at Rs 613.10, up Rs 10.95 or 1.82%. According to Jefferies, business growth, improving risk metrics and improving receivables position triggered its outlook on this stock.
The major receivables concern vis-a-vis Bangladesh is easing. India's eastern neighbour has paid $384 million, out of the total dues of $900 million, in June 2025. The company has struck a power purchase agreement to sell 9% of its capacity. The payment which was under a cloud after political uncertainty in Bangladesh is now being cleared. Obviously it lightens the concerns and improves the cash flow of the company.
Jefferies has also mentioned the earnings of Adani Power might be less volatile. “APL’s earnings volatility should reduce as merchant capacity drops closer to 10-12% by FY30E vs 18% by FY25. Interestingly, despite capacity moving up nearly 2x, APL’s net d:e will reduce to 0.6x by FY30E from current 0.7x given operational cash flow generation,” the report stated.
The brokerage expects a revenue growth (CAGR) of 20% and a 14% growth of operating profits (EBITDA). Accordingly, the company is valued at 15 X EBITDA on the earnings of FY27.
Jefferies has also mentioned a downside, if there is a slow growth in demand. In such a scenario, growth in revenue and EBITDA can decelerate to 19% and 11% respectively. The report has mentioned a possible 38% downside risk.
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