Adani Power Consolidated Net Profit For January-March Down 3.7%

Adani Power Ltd.'s consolidated net profit for the March quarter fell by 3.7% on year to ₹26.4 billion, as the rise in costs outpaced revenue growth. While the company's revenue increased due to higher sales volume, lower tariffs negated the gains, and fuel costs, along with power purchase costs for resale, surged on a year-on-year basis.

The company reported a 6.5% growth in its consolidated revenue for January-March to ₹142.4 billion, but expenses rose by 9.2% on year to ₹112.7 billion, overshadowing the increase in sales, leading to a fall in profits. Other income, including revenue settled after lawsuits and past discrepancies with buyers, dropped by 42.4% on year to nearly ₹3 billion.

In a statement, the company mentioned that its consolidated power sales volume for January-March reached 26.4 billion units, an 18.9% increase compared to the 22.2 billion units in the year-ago quarter, driven by higher power demand and increased operating capacity.

The company's consolidated continuing total revenue rose by 5.3% on year to ₹145.2 billion, primarily due to higher volume, but was offset by lower tariff realisation. Consequently, the consolidated continuing earnings before interest, tax, depreciation, and amortisation (EBITDA) for January-March fell by 3.3% on year to nearly ₹51 billion. Additional operating expenses from recent acquisitions, slower demand growth, and lower merchant tariffs contributed to the fall in EBITDA.

Despite the increase in sales volume, fuel costs, the largest overhead for a power generation company, rose by 7.3% on year to ₹79.2 billion, despite muted coal prices domestically and internationally. Coal, the primary raw material for thermal power generation, also saw an increase in power purchase costs for resale, which surged by 54.9% on year to ₹1.6 billion. Depreciation and amortisation costs increased by 9.6% on year to ₹10.4 billion, due to recent acquisitions. While transmission charges and finance costs decreased, the increase in other larger cost overheads pushed total expenses up by 9.2% on year to ₹112.7 billion.

For the year ended March 2025, Adani Power reported a 38% decline in consolidated net profit to ₹129.4 billion, despite a 11.6% increase in revenue to ₹562 billion, and the company reporting its highest ever operating and financial performance.

Operating capacity increased to 17.6 gigawatts as of March 2025, from 15.3 gigawatts a year ago. The plant load factor, or capacity utilisation of power plants, increased to 74.2% during 2024-25 (April-March), compared to 71.5% in the previous year.

"As we progress quickly in the next phase of capacity expansion, we are prioritising capital and cost efficiencies to sharpen our competitive edge and extend our sectoral leadership across key parameters. We are employing our deep, cross-domain expertise to make the business future-ready to continue delivering superior returns over the long term," said S.B. Khyalia, CEO of Adani Power.

The company’s power sales under power purchase agreements (PPAs) increased by 15.1% to 75.3 billion units in 2024-25 compared to 2023-24. For the January-March quarter, power sales under PPAs rose by 14.8% to 20.8 billion units, driven by newly acquired power plants and higher offtake due to power demand.

Power sales under short-term contracts and in the merchant market increased by 46.7% to 20.6 billion units in 2024-25 compared to 2023-24. For January-March 2025, these sales rose by 37.2% to 5.6 billion units, driven by increasing peak demand.

Despite higher sales volume, the average market clearing price on the Indian Energy Exchange declined by 15% on year to ₹4.47 per kilowatt-hour in 2024-25, down from ₹5.24 per kilowatt-hour in 2023-24. This impacted revenue growth, despite the higher sales volume. However, the company noted that merchant prices have regained strength with the early onset of summer in 2025.