🧠 At a Glance
Adani Green has become India’s renewable poster boy, scaling up solar and wind assets at warp speed. But behind the glittery gigawatts lies a leverage-heavy, margin-thin story with P/E ratios that defy gravity. With 127% profit CAGR in 5 years but almost zero dividends, is the stock more hype than watt?
1. ✈️ The Adani Green Elevator Pitch
- Founded: 2015, part of Adani Group
- Promoter Holding: 61% (as of Mar 2025)
- Business: Renewable energy (primarily solar + some wind), operating assets across India
- Scale: 8,400+ MW operational capacity and counting
Core USP?
Biggest player in India’s renewables with SECI/NTPC PPAs and juicy 25-year tariffs locked in.
2. 🌳 From Sapling to Solar Giant: Financial Growth
| Metric | FY20 | FY21 | FY22 | FY23 | FY24 | FY25 |
|---|---|---|---|---|---|---|
| Revenue (₹ Cr) | 2,549 | 3,124 | 5,133 | 7,776 | 9,220 | 11,212 |
| Net Profit (₹ Cr) | -68 | 182 | 489 | 973 | 1,260 | 2,001 |
| Operating Margin | 57% | 72% | 68% | 64% | 80% | 79% |
| Interest Cost (₹ Cr) | 995 | 1,953 | 2,617 | 2,911 | 5,088 | 5,492 |
🧬 TL;DR: Profits are rising fast, but so is debt. Margins are great due to fixed-tariff PPAs, but interest cost is a solar flare.
3. 🦄 Valuation: Why Is This Trading at 92x P/E?
- Current Price: ₹948
- P/E Ratio: 92.4x
- Book Value: ₹76.6
- P/B: 12.4x
- ROE: 14.6% | ROCE: 8.7%
At 12.4x book and 92x earnings, the stock is pricing in perfect sunshine forever. Even NTPC trades at a chill 14x.
4. ⚠️ The Leverage Overload
- Total Debt: ₹80,000+ Cr
- Debt/Equity: ~7.6x
- Interest Coverage: Barely above 1.6x
Despite strong cash flows, the debt-fuelled growth strategy is making investors nervous — especially post-Hindenburg.
🚩 Watch out: Nearly ₹20,000 Cr invested annually via CWIP. That’s a capex beast, not a gentle green push.
5. 📊 Shareholding Drama
| Category | Mar 2023 | Mar 2024 | Mar 2025 |
| Promoter | 57.3% | 56.4% | 60.9% |
| FIIs | 17.1% | 18.2% | 12.5% |
| Public | 24.1% | 24.0% | 24.2% |
🌍 FIIs are exiting slowly. Retail is HODLing like it’s a green Tesla. Promoters just upped stake again via warrant conversion.
6. ✨ Fair Value Range: ₹600 – ₹800
Why?
- Assume sustainable EPS of ₹20-22
- Assign conservative P/E range of 30-40x (still generous for infra)
- Gives us ₹600 – ₹800 FV band
This assumes debt doesn’t explode and PPAs don’t get renegotiated.
7. 🕵️ Edu View: Sunshine with Leverage Clouds
Adani Green is not a scam — but it’s not cheap either. It’s a top-down policy beneficiary with enviable assets, but the stock trades as if ESG nirvana is already achieved.
Would we call it overvalued? Yes. Would we call it dangerous? Only if debt balloons further. Would we call it boring? Never. This is Adani.
Tags: Adani Green Energy, renewable energy stocks, ESG India, overvalued stocks, solar stocks, Adani Group, stock analysis 2025, EduInvesting
✍️ Written by Prashant | 🗓️ June 21, 2025
