Adani Green Energy's rating upgraded to AA with 'Stable' outlook over robust growth

Ahmedabad, Aug 25

The rating assigned to bank facilities of Adani Green Energy Limited (AGEL), India’s largest renewable energy (RE) developer, factors in its market leadership position, robust execution capabilities with its strong operational and financial profile.

As on June 30, 2025, AGEL had an operational portfolio of 15.8 GWAC, comprising 70 per cent solar, 13 per cent wind, and 17 per cent hybrid assets.

“In addition, the company has an under-construction portfolio of ~15.1 GWAC, targeted for development in the next 4-5 years. AGEL’s strong execution track record is demonstrated by its rapid scale-up of operations in recent years and its ability to develop projects in challenging locations, such as Khavda, Gujarat, where it currently operates 5.6 GWAC,” the ratings agency said in a note.

The company has long-term vision to establish a cumulative capacity of 30 GWAC in Khavda going forward. Operational performance remained robust, supported by high plant and grid availability, generation exceeding design estimates, and a low collection period.

“These factors have translated in strong cash flows, healthy coverage indicators, and a comfortable liquidity position,” said the note.

The rating is also supported due to the presence of long-term (25-years) power purchase agreements (PPA) with central and state counterparties for 83 per cent of the operational portfolio which provides long-term revenue certainty.

Of the 13.1 GWAC, tied up capacity, 11.1 GWAC is tied up with stronger counterparties (central off-takers, Gujarat utilities & Adani Electricity Mumbai Limited), whereas the remaining 2.0 GWAC is exposed to state utilities, the note mentioned.

The rating favourably factors in the strategic partnership with TotalEnergies, which apart from holding 20 per cent stake in AGEL, also owns 50 per cent stake in 4.5 GWAC underlying joint ventures (JVs; comprising 4.1 GWAC operating capacity and 0.4 GWAC capacity under development).

While acquiring these stakes, TotalEnergies has provided AGEL with the necessary growth capital, which has aided the company is scaling up its operations.

CareEdge Ratings also factors in improvement in capital structure, post conversion of warrants across tranches in FY25 and Q1 FY26. The Adani family has infused Rs 9,350 crore, which has been utilised for the prepayment of holding company debt, partial repayment of related-party loans, and the remaining is earmarked for growth equity, the note said.

“The Stable outlook on the long-term rating of AGEL reflects CareEdge Ratings’ opinion that the company will be able to scale up its operating portfolio by commissioning underlying projects within scheduled timelines. The outlook is supported by the presence of long-term PPAs for majority underlying capacity,” it noted.

— IANS