Adani Green Q3 Fy26 Concall- Slowdown Explained

For Adani Green Energy Limited, the green energy developer arm of the Adani Group, the Q3 earnings for Fy 26 came in as more than a surprise to market watchers. The firm, with a long record of profitable growth, struggled on both fronts in Q3, even as total operational assets went up. So what caused this flagging of growth, and the slippage into losses?   

Key Factors For Slowdown
At the firm's post results call with analysts, among other factors, the firm's top management led by CEO Ashish Khanna zeroed in on three key factors that let them down in Q3.  Delays in transmission infrastructure for ready solar and wind projects that led to curtailments, lower than expected  wind speed that impacted earnings from wind energy sales, and finally, the lower merchant power prices that reduced the upside from merchant power sales, despite a higher share for these duering the quarter.  The firm's merchant power sales crossed 40% during the quarter due to the delays in connectivity. 

However, the firm was hopeful that multiple issues related to transmission availability would be resolved in Q4, even as power prices recover on the back of a return to business as usual and growth across large parts of the country. In the medium term, the firm is also counting on a significant boost from its upcoming energy storage facility coming up in Khavda to support better management of its power generation and distribution. The firm has announced a battery capacity of 3.5 GWh for the financial year, with plans to double it eventually in due course.

On the numbers front, in calendar year 25, Adani Green has so far added 5.6 gigawatts of greenfield capacity, which represents nearly 14% of countrywide solar and wind capacity addition, claims the firm.

At Khavda in Gujarat, the site for the company's most ambitious  roll out of green energy projects, the operational size of solar wiond and hybrid projects has touched 7.7 GW.  

Silver Price Impact

On the imnpact of rising raw material prices, especially silver prices on solar modules, the firm stressed that a combination of faster execution that can touch even 500 MW per month, plus access to modules and wind turbines from group firms mitigates the risk significantly for Adani Green as a developer.

Interest On Debt

From an operating debt to EBITDA, the company is at 4.6 and from an overall debt to run rate EBITDA, at about 5.6 levels. With a capex plan of  over Rs 40,000 crores next year, the firm expects to maintain debt levels at the same multiples as it inches closer towards its target of 50 GW by 2030. The management stressed that any devaluation in the Rupee has been hedged for, and will not impact costs.  

Outlook

With over 30 GW of capacity to be added over the next four years, the firm is counting  on it's execution speed, lower O&M costs with scale, energy storage  and of course a resolution in transmission delays stating with Q4 itself when it expects upto 3 GW of evacuation capacity to become available. Management stressed that their exposure to the 42 GW of projects that have the risk of cancellation is very low, and they can see the upside in connectivity that will open up even if those projects do face cancellation.