Whalesbook
📉 The Financial Deep Dive
Adani Power Limited (APL) navigated a challenging quarter ending December 31, 2025, reporting a 5.34% year-on-year (YoY) decrease in total revenue to ₹12,717 Crore for Q3 FY26. This dip was primarily attributed to lower Power Purchase Agreement (PPA) and merchant rates, which more than offset higher operating capacity and volumes.
EBITDA for the quarter demonstrated resilience, declining by a marginal 3.12% YoY to ₹4,636 Crore, indicating effective cost management even in a weak demand environment. However, Profit After Tax (PAT) experienced a more significant contraction of 15.37% YoY, settling at ₹2,488 Crore. This decline was predominantly due to lower one-time prior period income recognized in the current quarter compared to the previous year.
For the nine-month period (9M FY26), revenue stood at ₹40,524 Crore, down 3.40% YoY, while EBITDA fell 4.64% YoY to ₹15,713 Crore. PAT for 9M FY26 was ₹8,700 Crore, a 14.29% decrease YoY, affected by reduced operating and one-time incomes and higher depreciation from newly acquired assets.
🚩 Risks & Outlook
The company is aggressively pursuing growth, evidenced by securing a Letter of Award (LoA) from Assam Power Distribution Company Limited (APDCL) for a substantial 3,200 MW greenfield thermal power plant. This significantly boosts its expansion capacity tie-ups to 11.7 GW. APL also announced that 90% of its existing operating capacity is now secured under long-term and medium-term PPAs.
To fuel its ambitious expansion, APL successfully raised ₹7,500 Crore through AA-rated Non-Convertible Debentures (NCDs). The proceeds are earmarked for capacity expansion and working capital needs. The company highlighted progress on its expansion projects, including Mahan Phase-II (80% complete), Raipur Phase-II (44% complete), and Raigarh Phase-II (38% complete), with the revival of the Korba project also noted.
Corporate actions included the amalgamation of Adani Power (Jharkhand) Limited with APL and the acquisition of Vidarbha Industries Power Limited (VIPL) as a wholly-owned subsidiary. A joint venture was also formed for the Wangchhu Hydroelectric Project.
Management expressed strong confidence in India's long-term power demand and energy security needs, supported by cost-efficient plants and robust liquidity. However, total debt rose to ₹45,330.79 Crore as of December 31, 2025, with net debt at ₹38,679.28 Crore, reflecting increased leverage from bridge financing for capital expenditure. Despite short-term profit headwinds from revenue dips and one-offs, APL's strategic focus on capacity expansion, PPA tie-ups, and fundraising positions it for future growth in India's evolving energy landscape. Improved ESG ratings from CareEdge, Morningstar Sustainalytics, and CRISIL provide additional comfort.