Adani Green Energy Ltd.’s shares fell by about 7% during Monday’s trading session in response to the most recent set of accusations from Hindenburg Research. On Friday, however, local brokerage Emkay Global Financial Services began covering the Adani Group shares, pointing to a robust upside potential of over 50% in the shares.
According to Hindenburg Research’s most recent research, SEBI Chairperson Madhabi Puri Buch and her husband Dhaval Buch are connected to an Adani group-affiliated offshore fund. The short seller from the US claimed that SEBI was in charge of looking into investment funds in connection with the Adani case.
Increase In Solar Wind Projects
Over the previous five years, Adani Green Energy’s (AGEL) operational renewable energy (RE) capacity CAGR was 41%. It has well-secured locations in Gujarat and Rajasthan for solar-wind projects exceeding 50 GW, as well as an additional 5 GW for PSP with evacuation visibility. According to Emkay’s IC assessment, the Gujarat-Rajasthan supersites would now be the center of the momentum.
With 2,060kWh/sqmtr of solar irradiance and 8 mtr/sec of wind speed, these states have some of the highest resource yields in the world, with over 35 percent wind and 33 percent solar CUF. According to our estimates, AGEL’s basic RE market share could increase from 8% in FY24 to 15% by FY30E, and merchant capacity should increase from 5% to 6% to 20%.
Shares of Adani Green Energy fell 6.96% to Rs 1,656.05 during Monday’s trading session before rising slightly, bringing its entire market capitalization down to Rs 2.62 lakh crore more. The share closed Monday’s last trading session at Rs 1,780.10.
Rise In Power Supply Revenue
With $3.4 billion in revolving construction facilities from banks and access to less expensive long-term global bond markets for the operational phase, AGEL has a diverse reservoir of cash. The Emkay report further stated that internal accruals will guarantee future growth with the infusion of Rs 7,000 crore of leftover promoter funds.
“Agel’s consolidated net debt increased from Rs 9,200 crore in FY18 to Rs 53,900 crore in FY24; nevertheless, leverage ratios peaked in FY22, and as of the end of FY24, the net debt-to-EBITDA ratio was 7.4 times. This could drop to 3.6 times by FY30E, even though net debt increased to Rs 1.86 lakh crore because of the Rs 2.36 lakh investment.
We anticipate a steady decrease in AGEL’s cost of debt,” Emkay stated. For the first quarter that concluded in June 2024, Adani Green Energy reported a 38% YoY increase in its consolidated net profit of Rs 446 crore. The reporting period saw a 31% YoY rise in revenue from operations, reaching Rs 2,834 crore. Power supply revenue rose 24% year over year to Rs 2528.
