Synopsis: The share of this company delivered around 10x return, rising from Rs 23 to Rs 230 in five years, driven by capacity expansion and stable long-term PPAs.
The article outlines how this Adani company delivered a robust return, which is the largest private thermal power producer in India, along with its subsidiaries, selling power generated from these projects under a combination of long-term Power Purchase Agreements, short-term PPA and on a merchant basis
With a market capitalization of Rs 4,43,259 crore, Adani Power Ltd’s share closed at Rs 230 per share, down 1.31 percent from its previous close. The share of this company zoomed from Rs 23 to Rs 230 in the last five years, giving around a 10x return which is close to 900 percent return.
What changed over the past years?
Balance Sheet expansion and asset growth: From FY21 to FY26, the balance sheet shows strong expansion in scale. Total assets increased from Rs 78,535 crore in Mar 2021 to Rs 1,41,469 crore in Mar 2026, mainly driven by higher fixed assets and a sharp rise in capital work in progress (CWIP). CWIP moved up from Rs 6,439 crore to Rs 35,053 crore, reflecting a strong pipeline of ongoing projects and continued capacity expansion across the period.
Reserves build-up and borrowing cycle shift: On the liability side, reserves rose sharply from Rs 9,256 crore in FY21 to Rs 61,080 crore in FY26, supported by consistent profit generation. Borrowings showed a mixed trend, falling from Rs 52,411 crore in FY21 to Rs 34,862 crore in FY24 during the consolidation phase, and then increasing again to Rs 54,670 crore in FY26 as expansion picked up pace. Overall, the balance sheet reflects a clear shift from consolidation to an investment-led growth cycle backed by both internal accruals and debt.
Revenue and operating performance trend: From FY21 to FY26, the company’s revenue increased from Rs 26,221 crore in Mar 2021 to Rs 54,241 crore in Mar 2026, showing strong scale-up over the period. Operating profit rose from Rs 8,688 crore to Rs 19,806 crore during the same time, reflecting improved efficiency and higher generation volumes. Operating margin remained stable in the 33 percent to 38 percent range, showing a controlled cost structure despite expansion.
Profit growth and volatility in earnings: Net profit showed a sharp jump from Rs 1,270 crore in FY21 to Rs 12,971 crore in FY26, but the trend was not linear. It peaked at Rs 20,829 crore in FY24, primarily because of other income before moderating in FY25 and FY26. This fluctuation was driven by changes in tax rates, other income movements, and operating scale adjustments. EPS also moved up significantly from Rs 0.66 in FY21 to Rs 6.66 in FY26, reflecting long-term earnings expansion.
Cost structure and overall profitability cycle: Expenses increased from Rs 17,533 crore in FY21 to Rs 34,434 crore in FY26, broadly in line with revenue growth. Interest costs remained stable around Rs 3,300–5,100 crore range over the years, while depreciation gradually increased due to asset addition. Overall, the profit and loss statement shows a strong long-term growth cycle with improved operating scale, but short-term volatility in net profit due to tax and non-operating items.
Capacity growth over the years stands at:
In Q4 FY21, the company had an installed thermal power capacity of 12,410 MW spread across six power plants located in Gujarat, Maharashtra, Karnataka, Rajasthan and Chhattisgarh. Along with this, it also operated a small 40 MW solar power plant in Gujarat. At this stage, the capacity base was relatively limited, and the company was still in a consolidation phase with focus on stabilising operations and improving utilisation.
By Q4 FY26, the capacity profile had expanded sharply, with installed capacity rising to around 18,150 MW, supported by aggressive additions and operational improvements. Alongside this, the company positioned itself as India’s largest private-sector thermal power producer with a much larger long-term targeted capacity pipeline of 41,870 MW and fuel handling scale of 74 MMT. This reflects a clear shift from a moderate-sized generator to a large-scale integrated power producer with strong expansion visibility.
Future outlook
The company expects strong demand recovery from FY27, supported by rising electricity consumption and industrial activity. Merchant power exposure has reduced to around 5 percent, showing a clear shift towards stable long-term PPAs. Management is also targeting EBITDA of Rs 50,000 crore by FY2031, which could be achieved earlier in a strong execution scenario.
The capex trajectory remains strong, with planned spending of around Rs 25,000 crore in FY26–27 and Rs 33,000 crore in FY27–28. This sustained investment reflects continued focus on capacity building, efficiency improvement, and project completion across multiple thermal power assets under development.
The company has set a long-term capacity addition target of 23.7 GW by 2032 to reach its target capacity, with about 13.3 GW already tied up under long-term PPAs. Around 95 percent of operating capacity is now secured under PPAs, improving revenue stability and cash flow predictability over the long term.
Key ongoing projects include Korba Phase-II, expected to be commissioned in FY27, along with Raigarh Phase-II at 47 percent completion, Raipur Phase-II at 54 percent completion, and Mahan Phase-II at 86 percent completion. These projects will support gradual capacity addition and strengthen long-term growth visibility.
Conclusion
Adani Power’s 10x return over the last five years is mainly driven by a complete business transformation rather than a single factor. The company has moved from a stressed and low-utilisation utility in FY21 to a large, stable and expanding power producer by FY26. This shift is clearly visible in its financials, where assets more than doubled, reserves grew strongly, and operating profits expanded steadily despite some volatility in net profit.
At the same time, the shift towards long-term PPAs, higher capacity utilisation, and a strong capex-led expansion cycle has improved earnings visibility and reduced business risk. Combined with rising power demand in India and a large future capacity pipeline, the company has entered a long-term growth phase, which explains the sharp re-rating in its stock over the past five years.
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