Adani Energy Solutions
Adani Energy Solutions : Adani Energy Solutions distinguishes itself as a private TandD company that manages 20,422 circuit kilometers (km) of transmission lines and 54,600 MVA of transformation capacity, the company said.
Ventura Securities, strengthened by the shares of the Adani Group, sees a 50 percent growth potential in the shares of Adani Energy Solutions Ltd (formerly Adani Transmission) in two years. India’s transmission and distribution (TandD) sector is on an expansion trajectory, supported by a favorable policy environment, significant capacity developments and increased openness to private sector participation through tariff-based competitive bidding (TBCB).
Adani Energy Solutions distinguishes itself as a private TandD entity , that manages 20,422 circuit kilometers (km) of transmission lines and 54,600 MVA of power transformation capacity, it said.
Ventura said Adani Energy Solutions aims to build 30,000 km of transmission line by 2030, leveraging both organic and inorganic growth prospects. The company said strong industry headwinds and a leadership position in the competitive private tariff sector will result in significant revenue growth.
“We value Adani Energy Solutions at 17x EV/EBITDA and recommend a Buy with a target price of Rs 1,600, implying an upside of 50.4% from the CMP of Rs 1,064,” Ventura Securities said.
replace aging low-KVA transmission
Adani Energy Solutions: Ventura said the government’s efforts to replace aging low-KVA transmission lines with high-KVA transmission lines and double generation and transmission infrastructure have ensured strong growth prospects for Adani Energy Solutions’ power transmission business. The Indian government is expected to launch tenders for transmission lines worth Rs 10 lakh in the next decade.
“It is expected that 50 percent of this amount will go to private companies through TBCB. Accordingly, the company’s carryover revenue and EBITDA grow at a CAGR of 18.7% and 19.7% to ₹ 7,822 and ₹ 6,649 crore respectively in FY23-27. financial year.
Future power supply
Adani Energy Solutions holds electricity distribution licenses in Mumbai (Adani Mumbai Electricity Limited – AEML) and Mundra Utility Limited – MUL. Electricity distribution is an investment-based model and provides constant annual return on capital (15.5 percent for AEML and 14 percent for MUL). Citing increased power supply, AEML has committed to invest around INR 1,200 crore annually to build infrastructure for future power supply in 24-27. financial year.
“We expect the company’s power distribution revenue and EBITDA to grow at a CAGR of 15.4% and 14.9% to Rs 15,245 crore and Rs 3,659 crore, respectively, from FY23 to FY27.” said Ventura.
Adani Energy Solutions is also exploring several areas in the power distribution sector including Navi Mumbai in Maharashtra, Greater Noida (Gautama Buddha Nagar) in Uttar Pradesh and Mundra District in Gujarat (MUL present). We have applied for licenses in several areas, including (with the exception of the regions) Ventura said it does not play a role in the growth and revenue prospects of these regions.
Adani Energy Solutions : He said, “The fast-growing smart meter business segment in India is showing promising development and is expected to contribute significantly to the company’s revenue in the coming years.” “It gives us more control over retail distribution,” he said.
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