Adani Group stock has emerged as a key stock to watch as investor focus returns to India’s power sector amid rising electricity demand and expectations of stronger thermal capacity requirements.
Domestic brokerage house Motilal Oswal Financial Services (MOFSL) has initiated coverage on Adani Power with a Buy rating and a target price of ₹250 per share, implying over 20% upside from the current market price of ₹207. The brokerage sees the company as a key beneficiary of what it describes as India’s emerging thermal power renaissance, supported by rising electricity demand, a large expansion pipeline and limited competition in the thermal segment.
“We initiate coverage on Adani Power Limited (APL) with a BUY rating and TP of INR250/sh. We like APL for 1) ambitious growth plans (capacity up 2.3x to 42GW by FY32), 2) solid execution track record demonstrated by acquisition and turnaround of multiple distressed plants, and 3) optionality from nuclear foray + limited competition in the thermal segment,” it said in the note.
Why is MOFSL bullish on Adani Power?
According to the brokerage, India’s thermal power requirement could remain structurally strong even as renewable energy expands. The Central Electricity Authority (CEA) projects coal and lignite capacity to increase by around 86GW between FY26 and FY36, from about 229GW to 315GW. The brokerage believes this estimate could have further upside, as resource adequacy plans of the top five power-consuming states point to 32.6GW of incremental thermal capacity, compared with just 14.2GW implied by the national plan.
The brokerage also expects thermal power to become relatively more competitive. Solar currently enjoys a tariff advantage of more than ₹3 per kWh over thermal, but MOFSL expects this gap to narrow by 15-20% over the next three to four years, mainly due to the withdrawal of the ISTS waiver and cost escalation linked to ALMM-II/III.
Adani Power is positioned to benefit from this backdrop. It is India’s largest private thermal power producer, with around 18GW of operational thermal capacity at FY26-end, while its total capacity, including pipeline projects, stands at 41,830MW. The company aims to reach 42GW by FY32, more than doubling its existing operational capacity.
“We see APL as the natural winner of India’s upcoming thermal capacity build-out and beneficiary of a benign competitive environment. As the Central Electricity Authority (CEA)’s 86GW thermal capacity pipeline expands further, we note that APL faces limited competition as 1) generally only participates in regulated tariff-linked projects, 2) has publicly stated its intent to focus away from thermal and towards renewables, and 3) already has an ambitious pipeline of thermal/RE projects with a target to reach 30GW by 2030,” it highlighted.
MOFSL also highlights Adani Power’s execution track record and ability to acquire distressed thermal assets at attractive valuations. Its acquired capacity has come at an average cost of around ₹35 million/MW, compared with approximately ₹100 million/MW for upcoming greenfield capacity.
It also informed that Adani Power is undertaking a major expansion programme spanning 23,720MW, backed by estimated capex of around ₹2 trillion. Importantly, 100% of the required land has been secured and BTG equipment has already been ordered across the upcoming brownfield and greenfield projects. Around 60% of the pipeline is being developed through the brownfield route, while 94% is expected to use ultra-supercritical technology.
Estimates: Revenue, EBITDA and PAT outlook
For FY27, FY28 and FY29, MOFSL estimates revenue at ₹66,640 crore, ₹77,140 crore and ₹90,450 crore, respectively. is projected at ₹22,240 crore, ₹27,870 crore and ₹35,310 crore, while adjusted PAT is estimated at ₹13,080 crore, ₹13,680 crore and ₹16,580 crore. EBITDA margins are expected to improve from 33.4% in FY27 to 39% in FY29.
Overall, MOFSL models an EBITDA CAGR of 21% and PAT CAGR of 9% over FY26-FY29, with capacity additions of 1.3GW, 1.6GW and 3.2GW in FY27, FY28 and FY29. The brokerage values the stock at 16x FY29E EBITDA to arrive at its ₹250 target price.
Adani Power Stock Performance
The lost 3% in 1 week, 3% in 1 month, and 10% in 3 months. Meanwhile, it jumped 51% in 6 months and 71% in the last 1 year. Meanwhile, it has given multibagger returns in 5 years, soaring 910%
It had hit its 52-week high of ₹254.15 in May 2026 and its 52-week low of ₹120.36 in September last year.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.