Adani Power Retains 'Buy' From Ventura On Strategic Positioning, Capacity Expansion

Ventura maintained its 'buy' rating on Adani Power Ltd. and raised its target price to Rs 806, implying an upside potential of 55%. Enhanced coal availability and business expansion are fueling growth, it said. The company is positioned for future growth through consistent investments in thermal power capacity.

Adani Power is strategically positioned with robust capacity expansion plans that is set to address the critical demand coming in. It is targeting a total capacity of 30.67 GW by financial year 2031. This is expected to increase the company’s share in India’s thermal power sector from 6% this year to 11% by financial year 2031.

Rising power demand, supported by lower imported coal prices and improved domestic coal availability, has boosted the company's average plant load factor, which rose to the highest in seven years at 72%. The performance exceeds estimates, Ventura said.

There is a manageable net debt of Rs 30,985 crore that is supported by balanced sheet strength, according to the brokerage. The acquisition of three power plants — Coastal Energen Pvt., Lanco Amarkantak Power Ltd., and Dahanu Thermal Power plant — boosted operational capabilities.

Adani Power stock rose as much as 0.92% during the day to Rs 526.60 apiece on the NSE. It was trading 0.12% higher at Rs 522 apiece, compared to a 0.21% advance in the benchmark Nifty 50 as of 9:27 a.m.

It has risen 0.78% in the last 12 months. The relative strength index was at 49.2.

Ventura is the only brokerage tracking the company and they have a 'buy' rating on the stock. The 24-month analysts' consensus target price on the stock is Rs 806, implying an upside of 54.5%, according to Bloomberg data.

Disclaimer: NDTV is a subsidiary of AMG Media Networks Ltd, an Adani Group Company.