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Elara Sees Further Upside in Adani Power Despite Valuation Concerns
Adani Power runs power plants that make electricity, mostly by burning coal.
The company currently has 18.3 GW of capacity and plans to add 24 GW more.
Elara Capital thinks this expansion could help the company grow.
Some of the planned power output will be sold through long-term agreements, while some could be sold in the electricity market.
Elara says coal power may remain useful because renewable sources do not always produce electricity when it is needed.
The brokerage set a target price of ₹220 and gave the shares an Accumulate rating.
But it also warned that investors may already have priced in much of the expected growth.
The stock has recently declined even though the article reports a 27% rise in 2026.
Elara Capital initiated coverage of Adani Power with an Accumulate rating and a ₹220 target price, implying over 16% upside from its ₹189 close on 9 October.
The brokerage cited a 24 GW expansion pipeline that could raise the company’s capacity from 18.3 GW to 42 GW.
About 55% of the expansion pipeline is backed by long-term power purchase agreements, while the rest offers potential merchant-market exposure.
Elara said thermal generation remains important for reliable electricity as renewable energy grows, and pointed to India’s goal of adding around 80 GW of coal power by FY32.
Despite a reported 27% gain in 2026, the shares had fallen 11.89% over the past month; Elara cautioned that much of the growth outlook may already be reflected in the valuation.
- Who
- Adani Power and brokerage Elara Capital.
- What
- Elara Capital initiated coverage with an Accumulate rating and a ₹220 target price, citing expansion and power-market opportunities while warning that much growth may already be priced in.
- Where
- India; the shares closed at ₹189 on the BSE.
- When
- The target was compared with Adani Power’s closing price on 9 October; the article also reports performance in 2026.
- Why
- Elara cited the company’s capacity expansion plans, long-term power purchase agreements, merchant-market opportunities, and the continuing role of thermal power.
Growth case
Valuation caution
Expansion and earnings opportunity
Growth case
Elara sees growth visibility from a 24 GW expansion pipeline, long-term PPAs, merchant-market exposure and possible acquisitions.
Valuation caution
Elara cautions that a significant portion of the medium-term growth opportunity may already be reflected in the share price.
Role of thermal power
Growth case
The brokerage says dispatchable thermal power can support energy security and balance intermittent renewable generation.
Valuation caution
The article notes that battery storage and pumped storage are also expected to complement renewable energy as its share rises.
Key facts
- Brokerage rating
- Accumulate
- Target price
- ₹220
- Reference closing price
- ₹189 on the BSE on 9 October
- Implied upside
- Over 16%
- Current operating capacity
- 18.3 GW across 13 assets
- Locked-in expansion pipeline
- 24 GW, potentially taking targeted capacity to 42 GW
- Expansion backed by long-term PPAs
- 13.3 GW, or around 55% of the pipeline
- Valuation basis
- 12 times estimated FY29 EV/EBITDA
Sources
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