Adani Green Energy to see 30% CAGR capacity growth

New Delhi, Adani Green Energy Ltdhe renewable energy signature of the billionaire Gautama AdaniAGEL conglomerate is expected to register an operating capacity CAGR of over 30 percent to reach over 50 GW of capacity by 2030, according to a report released on Monday. AGEL aims to add 6-7 GW of capacity annually to become the world’s largest renewable energy producer.

Starting AGEL coverage, brokerage Mother He said the company’s renewable capacity would experience a compound annual growth rate (CAGR) of over 30 percent from now to 2030, while improved capacity utilization will drive a power sales CAGR of around 35 percent.

“We expect AGEL to achieve operational renewable energy (RE) capacity CAGR of 31 percent to 56.5 GW (including investment solar for PSPs) during FY24-30E as the Khavda supersite is developed up to 30 GW from around 2 GW at the end of FY24 (now at 2.3 GW), along with expansion in other assets like Rajasthan and PSPs (pumped storage plants),” he said.

The company aims to achieve this by fiscal year 2029 (April 2028 to March 2029).

AGEL started operations in FY16 and achieved the 1 GW capacity mark in the first half of FY17-18. During FY18 to end of FY24, the operational capacity CAGR was rapid at 33 per cent from 2 GW to nearly 11 GW, with solar being the mainstay growing to 7.4 GW from 1.9 GW, with wind capacity increasing to 1.4 GW from 60 MW; furthermore, the hybrid project capacity (in Rajasthan), which started from FY23, stood at 2.1 GW.

AGEL has secured a PPA for 20.4 GW capacity so far, with 10 GW operational; some of the key assets are Kamuthi (0.6 GW), the solar-wind hybrid cluster in Rajasthan (2.1 GW) and the recently commissioned 2 GW at Khavda. The company acquired SB Energy’s 5 GW portfolio in 2021, which included 1.7 GW of operational capacity, with the remainder under construction/development. AGEL also won the bulk of the 8 GW of the 12 GW SECI solar manufacturing tender. 2 GW at Khavda was commissioned a year after the company started work.

“AGEL aims to be the lowest cost producer throughout the entire life cycle of an asset,” said Emkay.

“It has the ability to gain efficiency from the construction stage, with large-scale internal execution, better negotiation capacity with suppliers (modules, etc.), project management experience and rapid development, resulting in faster commissioning and leading to lower IDC and pre-operational costs.”

AGEL has seen revenue growth at 35 per cent CAGR during FY24-30. The sites in Gujarat (Khavda) and Rajasthan (the most resource-rich sites globally) will help AGEL grow its revenue at a CAGR of 35 per cent, giving it a clear runway of another 50 GW, plus another 6.5 GW with pumped storage and evacuation visibility solutions.

Moreover, the capacity utilization factor (CUF) will improve as new sites will be provided with abundant resources to increase production volume, he said, adding that increased participation of traders and trading companies and industries (CI) would improve realisations.

The balance sheet would improve dramatically and net debt/EBITDA could fall to 3.6x from 7.4x despite the expansion, as cash flows from existing projects will largely cover future expansion, he added.