ADANIGREEN - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 19 Sept 25, 2:16 pm

Fundamental Rating: 3.4

Here’s a detailed analysis of Adani Green Energy Ltd (ADANIGREEN)

🧾 Core Financials

Profitability & Growth

Quarterly PAT dropped from ₹113 Cr to ₹69 Cr, despite a YoY profit variation of 178%, indicating high volatility.

EPS: ₹4.87 — low, especially for a ₹1.58 lakh Cr market cap.

ROE: 9.41% and ROCE: 8.87% — modest returns, below ideal for capital-intensive businesses.

Debt & Liquidity

Debt-to-equity: 2.47 — high leverage, typical for infrastructure-heavy renewable firms.

Dividend Yield: 0.00% — reinvestment-focused, common for growth-stage utilities.

📊 Valuation Indicators

Metric Value Industry Avg Remarks

P/E Ratio 186 31.2 Extremely overvalued

P/B Ratio ~18.9 ~3.5 High premium to book value

PEG Ratio 1.67 ~1 Price exceeds growth potential

Intrinsic Value ~₹700–₹800 — Overpriced vs fundamentals

The stock trades at a steep valuation, driven more by future potential and ESG sentiment than current earnings.

🏢 Business Model & Competitive Edge

Core Operations: Solar and wind energy generation, with a focus on utility-scale projects.

Strengths

One of India’s largest renewable energy players with aggressive capacity expansion.

Long-term PPAs ensure revenue visibility.

Risks

High debt and weak return metrics.

FII outflows (-0.87%) may reflect valuation concerns or governance caution.

📉 Technical & Entry Zone

Current Price: ₹979

DMA 50/200: ₹966 / ₹1,066 — trading below long-term average.

RSI: 57.1 — neutral zone.

MACD: 5.43 — mild bullish momentum.

Suggested Entry Zone: ₹800–₹850 range, ideally near ₹758 support or below intrinsic value.

🕰️ Long-Term Holding Guidance

Hold only if already invested, but monitor debt levels and earnings consistency.

Avoid fresh entry unless valuation cools and ROE/ROCE improve.

Ideal for long-term only if

Capacity expansion translates into sustained profitability.

Valuation normalizes below P/E 60 and PEG < 1.2.

Would you like a peer comparison with Tata Power Renewable or a breakdown of Adani Green’s capacity pipeline?

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