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Informist, Wednesday, Apr. 30, 2025

By Avishek Rakshit

KOLKATA – Adani Power Ltd.'s consolidated net profit for the March quarter fell 3.7% on year to INR 26.4 billion, as the rise in costs was more than the growth in revenue. Although the company's revenue rose due to increased sales volume, lower tariffs negated the gains and fuel costs, together with power purchase costs for resale, surged on year.

The company reported a 6.5% on-year growth in its consolidated revenue for Jan-Mar to INR 142.4 billion, but expenses rose by 9.2% on year to INR 112.7 billion overshadowing the increase in sales, leading the company to report a fall in profits. Other income, which includes the revenue settled after lawsuits and past discrepancies with its buyers, fell by 42.4% on year to nearly INR 3 billion.

In a statement, the company said its consolidated power sales volume at 26.4 billion units in Jan-Mar, rose by 18.9% on year from 22.2 billion units in the year-ago quarter due to growing power demand and higher operating capacity.

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

Though sales volume increased, so did costs. Fuel costs – the largest cost overhead for any power generating company – rose 7.3% on year to INR 79.2 billion. This was despite coal prices remaining muted in the country and overseas. Coal is the primary raw material for thermal power companies to generate electricity. Its outgo on power purchases, meant for resale, also increased by 54.9% on year to INR 1.6 billion. However, owing to the spate of recent acquisitions, depreciation and amortisation costs increased by 9.6% on year to INR 10.4 billion. Transmission charges and finance costs fell, but since larger cost overheads increased substantially, it pushed up total costs by 9.2% on year to INR 112.7 billion.

For the year ended March, Adani Power reported a 38% fall in consolidated net profit to INR 129.4 billion, although revenue increased by 11.6% to INR 562 billion, and the company reported its highest ever operating and financial performance.

Operating capacity increased to 17.6 gigawatts as at March-end from 15.3 gigawatts a year-ago, and plant load factor, or the capacity utilisation of power plants increased to 74.2% during 2024-25 (Apr-Mar) from the earlier 71.5%.

"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," S.B. Khyalia, chief executive officer of Adani Power, said in a statement.

The company's power sales under power purchase agreements increased by 15.1% to 75.3 billion units in FY25 compared to FY24, and by 14.8% to 20.8 billion units in the March quarter of FY25 on account of newly acquired power plants, and higher offtake, driven by power demand.

Power sales under short-term contracts and in the merchant market increased by 46.7% to 20.6 billion units in FY25 compared to FY24, and by 37.2% to 5.6 billion units in Jan-Mar on account of growing peak demand.

However, as a result of the cold weather during the winters and an increase in supply of electricity, average market clearing price on the Indian Energy Exchange declined by 15% on year to INR 4.47 per kilowatt-hour in FY25 from INR 5.24 kilowatt-hour in FY24, affecting the company's revenue growth despite higher sales volume. However, merchant prices have regained strength with the early onset of summer in 2025, the company said.

On Wednesday, shares of Adani Power closed more than 3% lower at INR 532.05 on the National Stock Exchange.  End

Edited by Ashish Shirke

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