Adani Green, the renewable energy division of Adani Group, has reported a remarkable 49% growth in its operational capacity, reaching 8,086 MW by the end of the fiscal year 2023. This milestone signifies the largest capacity expansion achieved by any domestic renewable energy company in India to date.
Adani Green, the country’s top renewable energy company, currently has a total installed capacity of 20,000 MW.
Adani Green has successfully commissioned a 325 MW wind power facility in Madhya Pradesh, a 212 MW solar power plant in Rajasthan, and the largest-ever 2,140 MW solar-wind hybrid power plant in Rajasthan. This significant capacity growth is part of the company’s broader strategy to reduce leverage levels by enhancing operational efficiency across sectors and boosting overall operating profit.
As reported by Mint on April 6th, Adani group has outlined plans in recent creditor meetings to decrease the group’s leverage ratio from 4.1 times to 3.1 times by the end of FY24. This will be achieved primarily through earnings growth rather than debt reduction, amounting to approximately $23 billion.
Adani Group aims to significantly enhance its operating profit by nearly 50% to approximately ₹91,000 crores within the next two fiscal years, as part of its strategy to lower leverage ratios and address investor and creditor concerns. This comes in response to Hindenburg Research’s critical report on January 24th, which labeled the group as over-leveraged.
The increase in Adani Green’s operational capacity, including the recent commissioning of new renewable energy facilities, could potentially support the group in achieving its target of accelerating earnings growth to 20-22% during FY2024-25.
According to a report by Mint, the group’s net debt-to-EBITDA ratio was 7.6 times in 2013, which declined to 3.2 in March 2022 but increased to around 4.1 in FY23. As of March 31st, the group’s total debt stands at ₹2.27 trillion. Adani’s new strategy aims to improve its financial performance and strengthen its balance sheet in the coming years.
Adani Green announced a significant year-on-year (YoY) growth of 58% in energy sales on Friday, attributed to the recent capacity addition. The company reported a total energy sales volume of 14.9 billion units in the fiscal year 2022-23 (FY23), compared to 9.43 billion units in the fiscal year 2021-22 (FY22). This robust growth in energy sales reflects the positive impact of the increased operational capacity of Adani Green, showcasing its continued progress and success in the renewable energy sector.
In an exchange filing on Friday, Adani Green stated that it aims to achieve a renewable energy capacity of 45 GW by 2030 while keeping the average tariff below the Average Power Purchase Cost at the national level.
The company reported a noteworthy 29% year-on-year (YoY) increase in sales to 10,457 million units in the fiscal year 2022-23 (FY23) under its solar energy portfolio. This growth was primarily attributed to the integration of the operational portfolio of SB Energy (1,700 MW) and the commissioned capacity of 212 MW in Rajasthan during FY23. As a result, the effective operating capacity increased, leading to 90 basis points (bps) rise in the capacity utilization factor and a 50 bps improvement in grid availability.
In its wind energy business, Adani Green disclosed a significant 37% YoY surge in sales to 1,820 million units in FY23. This growth was driven by the increase in capacity from 497 MW to 971 MW, showcasing the company’s expansion in the wind energy segment. Adani Green’s strong sales performance in both solar and wind energy portfolios highlights its commitment to renewable energy and its efforts to achieve its ambitious capacity targets.
