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Adani Green Energy (ADANIGR IN) reported strong YoY performance in Q2FY27, with revenue increasing 41.6% to INR 42.6bn and EBITDA by 45.9% to INR 37.9bn, while sequential performance remains muted due to lower utilization. Reported PAT increased 16% YoY to INR 7.4bn. Operational capacity grew 24% YoY to 20.8GW, including 621MW added during the quarter, driving a 32% YoY increase in energy sales to 25,747mn units. ADANIGR commissioned ~3.1GWh of BESS at Khavda during Q2FY27, taking installed storage capacity to 6.6GWh, and targets >10GWh by FY27 and 50GWh of BESS alongside 5GW of pumped storage in the next five years.

Capacity-led annual growth; QoQ muted on lower utilization: Revenue from operations increased 41.6% YoY but declined 3.9% QoQ to INR 42.6bn. EBITDA rose 45.9% YoY and fell 4.7% QoQ to INR 37.9bn. EBITDA margin was at 89.2% in Q2FY27 vs 87.0% in Q2FY26 vs 89.9% in Q1FY27. Finance cost increased 30% YoY and 6% QoQ to INR 21.2bn. Depreciation rose 30% YoY and 6% QoQ to INR 10.8bn. Other income was up 9% YoY and 13% QoQ to INR 2.6bn. There was a deferred tax of ~INR 2.1bn in Q2FY26. Reported PAT surged ~15.9% YoY to INR 7.4bn.

Strong operational performance: Operational capacity increased 24% YoY to 20,763MW, including Greenfield additions of 4,083MW, with 621MW added during the quarter. The additions comprised 2,957MW of solar capacity (2,568MW at Khavda, Gujarat, and 389MW in Rajasthan), 805MW of wind capacity (666MW at Khavda and 139MW at Mundra, Gujarat), and 321MW of hybrid capacity at Khavda. Energy sales rose 32% YoY to 25.74BU, supported by capacity expansion. H1FY27 CUF stood at 22.9% for solar, 42.9% for wind, and 45.2% for hybrid, supported by plant availability of 99.3%, 94.6% and 98.8%, respectively.

Ambitious BESS roadmap in the next five years: ADANIGR is rapidly scaling up its energy storage platform, targeting an increase in BESS capacity from ~6.6 GWh currently to more than 10GWh by FY27, and 50GWh of battery storage capacity along with 5GW of pumped storage capacity in the next five years. The company commissioned 3.0GWh of BESS at Khavda in Q2FY27, taking installed capacity to 6.6GWh, with ~3.3GWh already tied up under contracts. Management expects strong demand from commercial and industrial (C&I) customers, including data centres, for firm and round-the-clock renewable power. The accelerated storage rollout is likely to support earnings growth and offset curtailmentrelated losses in H2FY27. Separately, the company is progressing on its maiden 500MW pumped-storage project at Chitravathi, targeted for completion by year-end.

Retain Accumulate and a TP of INR 1,502: We expect an EBITDA CAGR of ~ 30% and a PAT CAGR of ~42% during FY26-29E, underpinned by robust capacity addition, improving operating leverage, and a rising share of high-margin renewable assets. We retain Accumulate and a TP of INR 1,502 based on 17x FY29E EV/EBITDA. Delay in project execution and grid transmission commissioning remain key risk to our call. We raise our earnings by 8% for FY27E and keep them unchanged during FY28-29.

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