MUMBAI: Adani Power Ltd (APL) plans to invest Rs 1.2 lakh crore in expanding power generation capacity over the next six years, even as the country’s largest private sector power producer has already placed advanced orders for 11.2 gigawatt of ultra supercritical boilers, turbines and generators to secure a supply chain.
The Adani Group company has an operating capacity of 17.55 GW, which it aims to increase to 30.67 GW by 2030. In the private sector, its capacity expansion will be the largest. In the public sector, state-owned NTPC is planning to add 30 GW of thermal power capacity by 2032, on top of the earlier 26 GW.
“We are trying to see if there can be a bigger capex opportunity targeting Rs 1.2 lakh crore over the course of the next six years,” the APL management said on an analyst call on Thursday, adding that the company will fund the capital expenditure through its internal accruals.
“We have, on a continuing basis, reported more than Rs 21,000 crore EBITDA (earnings before interest, taxes, depreciation and amortisation), and we are expecting to (generate) more than that. So, our internal accruals will be sufficient to meet our capex requirements.”
The company added that it plans to expand capacity to 30,670 megawatt by 2030 and is currently constructing three brownfield projects of 300 MW each, at Mahan (Madhya Pradesh), and a 1,320 MW expansion project at Raipur and Raigarh in Chhattisgarh.
“Altogether, we have given advanced orders for 11.2 gigawatt of ultra super critical boilers, turbines and generators to secure a supply chain,” the APL management said on the call.
Dividend Decision at the Right Time
The management called it a strong competitive advantage for the company as it will have capacity getting commissioned ahead of the competition.
On payment of dividend, the management said, “Dividend is a decision that the board will take at the right time when the returns that they are generating from incremental cash flow investments are lower than the marginal rate of return that the investors are looking for.”
Adani Power on Wednesday reported a 5% fall in JanuaryMarch net profit to Rs 2,599.23 crore from Rs 2,737.24 crore a year ago. For the entire financial year 2024-25, net profit plunged 39% to Rs 2,749 crore from Rs 20,828 crore in the previous fiscal.
Revenue rose 6.54% to Rs 14,237 crore in the fourth quarter against Rs 13,363 crore a year ago. For the entire year, revenue from operations increased 11.62% year-on-year to Rs 56,203 crore against Rs 50,351 crore. Total income grew 4.7% to Rs 14,535 crore in the March quarter, up from Rs 13,881 crore in the year ago period.
“APL plans to grow its operating capacity to 30+ GW and command a larger share of the domestic thermal power market, as the company sees coal as a sticky input to the growing economy and power market of India,” Cantor Fitzgerald Research said in a report dated May 1, adding that Adani Power also has 87% of its capacity contracted under long-term power purchase agreements, of which 92% have fuel cost recovery, providing long-term visibility and safety to the company’s cash flows and margin profile.
Adani Power’s thermal power plants are strategically placed near domestic coal mines or international ports, enabling the power producer to source coal more efficiently and capture more upside in times of peak power demand, the report added.
“We have won four mines with a total of 14 mtpa capacity. Three of these mines are in Madhya Pradesh and one is in Maharashtra. One of the mines will start coal production this year,” APL said, adding that this will help it augment coal supply, sharpen its logistics advantage and develop a long-term source for coal capacities.
“We are highly confident that thermal power will continue to play a key role in India’s energy mix in the foreseeable future, and Adani Power will play a key role in achieving India’s energy goals in the coming years,” the company said.
The Adani Group company has an operating capacity of 17.55 GW, which it aims to increase to 30.67 GW by 2030. In the private sector, its capacity expansion will be the largest. In the public sector, state-owned NTPC is planning to add 30 GW of thermal power capacity by 2032, on top of the earlier 26 GW.
“We are trying to see if there can be a bigger capex opportunity targeting Rs 1.2 lakh crore over the course of the next six years,” the APL management said on an analyst call on Thursday, adding that the company will fund the capital expenditure through its internal accruals.
“We have, on a continuing basis, reported more than Rs 21,000 crore EBITDA (earnings before interest, taxes, depreciation and amortisation), and we are expecting to (generate) more than that. So, our internal accruals will be sufficient to meet our capex requirements.”
The company added that it plans to expand capacity to 30,670 megawatt by 2030 and is currently constructing three brownfield projects of 300 MW each, at Mahan (Madhya Pradesh), and a 1,320 MW expansion project at Raipur and Raigarh in Chhattisgarh.
“Altogether, we have given advanced orders for 11.2 gigawatt of ultra super critical boilers, turbines and generators to secure a supply chain,” the APL management said on the call.
Dividend Decision at the Right Time
The management called it a strong competitive advantage for the company as it will have capacity getting commissioned ahead of the competition.
On payment of dividend, the management said, “Dividend is a decision that the board will take at the right time when the returns that they are generating from incremental cash flow investments are lower than the marginal rate of return that the investors are looking for.”
Adani Power on Wednesday reported a 5% fall in JanuaryMarch net profit to Rs 2,599.23 crore from Rs 2,737.24 crore a year ago. For the entire financial year 2024-25, net profit plunged 39% to Rs 2,749 crore from Rs 20,828 crore in the previous fiscal.
Revenue rose 6.54% to Rs 14,237 crore in the fourth quarter against Rs 13,363 crore a year ago. For the entire year, revenue from operations increased 11.62% year-on-year to Rs 56,203 crore against Rs 50,351 crore. Total income grew 4.7% to Rs 14,535 crore in the March quarter, up from Rs 13,881 crore in the year ago period.
“APL plans to grow its operating capacity to 30+ GW and command a larger share of the domestic thermal power market, as the company sees coal as a sticky input to the growing economy and power market of India,” Cantor Fitzgerald Research said in a report dated May 1, adding that Adani Power also has 87% of its capacity contracted under long-term power purchase agreements, of which 92% have fuel cost recovery, providing long-term visibility and safety to the company’s cash flows and margin profile.
Adani Power’s thermal power plants are strategically placed near domestic coal mines or international ports, enabling the power producer to source coal more efficiently and capture more upside in times of peak power demand, the report added.
“We have won four mines with a total of 14 mtpa capacity. Three of these mines are in Madhya Pradesh and one is in Maharashtra. One of the mines will start coal production this year,” APL said, adding that this will help it augment coal supply, sharpen its logistics advantage and develop a long-term source for coal capacities.
“We are highly confident that thermal power will continue to play a key role in India’s energy mix in the foreseeable future, and Adani Power will play a key role in achieving India’s energy goals in the coming years,” the company said.
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