Whalesbook
THE SEAMLESS LINK
While Adani Power's top line expanded with an 11.62% revenue increase to Rs 56,203.09 crore for the fiscal year ending March 2025, this growth was overshadowed by a substantial contraction in profitability. Net profit plummeted by nearly 39% to Rs 12,749.61 crore, and earnings per share (EPS) fell from Rs 51.62 to Rs 32.32, signaling underlying cost pressures or operational challenges.
The Core Catalyst
Adani Power shares saw a modest 2.05% rise, trading at approximately Rs 142.77 earlier today, February 16, 2026 [cite: input]. This uptick occurred against a backdrop of mixed financial signals. For the fiscal year ending March 2025, consolidated revenue climbed 11.62% to Rs 56,203.09 crore, a positive indicator of market demand and operational capacity expansion [cite: input, 16]. However, net profit experienced a sharp 39% year-on-year decline to Rs 12,749.61 crore from Rs 20,828.79 crore in the prior fiscal year [cite: input]. Quarterly results from December 2025 also mirrored this trend, with revenue decreasing and net profit falling, leading to a significant drop in EPS to Rs 1.29 from Rs 7.67 year-over-year [cite: input]. This divergence between revenue growth and profit contraction raises questions about the sustainability of current margins and cost management strategies. The stock's current trading price of Rs 141.50 (as of Feb 16, 2026) reflects a P/E ratio around 23.5-26.5 on a trailing twelve-month (TTM) basis, which is higher than that of peers like NTPC but lower than Tata Power, suggesting investors are factoring in future growth potential despite current profitability concerns. The reported annual EPS for FY25 was Rs 32.32, indicating a significant difference from the TTM EPS implied by current market prices and P/E ratios [cite: input].
The Analytical Deep Dive
Adani Power's valuation, with a TTM P/E ratio hovering around 23.5-26.5, positions it between NTPC's P/E of approximately 14-22 and Tata Power's P/E of around 27-31. The company commands a market capitalization of roughly Rs 270,000 crore. While Adani Power's revenue growth reflects strong demand in India's expanding energy sector, where electricity consumption is projected to rise by 27% through 2030, its declining profitability suggests operational efficiencies may be under pressure. The Indian power sector is rapidly integrating renewables, with clean energy forming 40% of installed capacity by early 2026, and bank lending to the sector showing robust growth. However, challenges persist in grid flexibility and managing coal-fired capacity alongside renewable integration. Adani Power's corporate actions, including a 1:5 stock split effective in September 2025, aimed to enhance liquidity and retail investor access. Its year-to-date performance in 2026 has shown volatility, with a decline of 2.16% as of February 16, 2026, following mixed performance patterns observed in early 2025.
⚠️ THE FORENSIC BEAR CASE
Despite recent positive price movements and revenue expansion, significant headwinds and historical concerns cast a shadow over Adani Power. MarketsMojo assigned a 'Sell' grade with a Mojo Score of 42.0 in July 2025, citing a low Market Cap Grade of 1, indicative of potential valuation or fundamental issues relative to peers. Furthermore, a Moneycontrol analysis on February 13, 2026, flagged prevailing bearish sentiment [cite: input]. The company and its parent group have faced a series of serious allegations, including bribery and fraud charges by U.S. prosecutors, and a prior OCCRP report detailing alleged over-invoicing of power equipment and siphoning of funds through tax havens. These reports, though denied by the Adani Group, point to a history of financial scrutiny. Past controversies also include alleged violations of wildlife protection norms by Adani Power, accusations of coercion and undue influence in land acquisition for a thermal plant, and claims of unconscionable conduct in contractual disputes. Such historical controversies raise persistent questions about corporate governance and ethical practices, potentially impacting investor confidence and future regulatory oversight, even as the company pursues significant capacity expansion.
The Future Outlook
Analysts are divided, with some initiating coverage with a 'Buy' rating and a target price of ₹178 to ₹187, suggesting an upside of up to 33.67%. This optimistic view is based on projected EBITDA growth and capacity expansion plans. However, the prevailing bearish sentiment noted by market analysts and the 'Sell' grade from MarketsMojo [cite: input, 25] suggest a cautious outlook for the stock, emphasizing the need for investors to weigh the growth potential against the persistent concerns surrounding profitability, operational efficiency, and past allegations.