Synopsis: Adani Power shares fell 6% after legal developments surrounding its proposed Uttar Pradesh thermal power project created uncertainty. Although the Supreme Court did not stay the project, the ongoing environmental challenge and regulatory scrutiny triggered investor caution, leading to profit booking despite no fresh earnings-related triggers.
The shares of this company, which is a part of the diversified Adani Group and is the largest private thermal power producer in India, and which, along with its subsidiaries, sells power generated from these projects under a combination of long-term Power Purchase Agreements, short-term PPAs and on a merchant basis, had its shares tumble today after the updates regarding its thermal plant in UP came into the limelight.
With the market cap of Rs 2,70,853 crore, the shares of Adani Power Ltd have fallen about 6% and reached a low at Rs 139.50, compared to their previous day’s closing price of Rs 149.80. The shares are trading at a PE of 23.7, whereas its industry PE is at 24.2.
About the U.P thermal plant case
The shares were down today pertaining to the case which involves a petition against the environmental clearance which was granted to Adani Group for setting up a proposed thermal power plant in Uttar Pradesh. The plea raises concerns over the ecological impact the project would have, as it is near the forest areas and wildlife habitats.
The Supreme Court, on Thursday, refused to pass any interim order banning the proposed project and said it will look into responses from both the state and central governments first. A bench, led by Chief Justice Surya Kant, observed that the development concerns, especially in a power deficit state, could not be brushed aside without a proper review. It noted that there has to be a balance between environmental protection and developmental requirements.
The site of the project is located in a forest area, and there are chances that this project might harm the sloth bears living there, said senior advocate Sanjay Parikh, appearing on behalf of the environmental activist. He further added that environmental clearance has been accorded in this case, though the case is still pending before the Supreme Court and the National Green Tribunal. It has raised many questions regarding the proper procedure, said the petitioner. The size of the power plant may result in irreversible ecology if not properly examined.
In response to these submissions, the bench observed that while there is a need to be concerned about the issues with regard to the environment, developmental works cannot be stayed on apprehensions. The Chief Justice pointed out that there should be better enforcement measures and safeguards instead of prohibition. The court asked the Centre, the state government, and the Adani Group to file detailed responses with regard to how ecological safeguards would be put in place while taking up the project.
Financials and more
The revenue from operations for the company stood at Rs 12,451 crores in Q3 FY26 compared to Q3 FY25 revenue of Rs 13,671 crores, down by about 9 per cent YoY. Similarly, the net profit stood at Rs 2,488 crore in Q3 FY26, down compared to the Rs 2,940 crore profit in Q3 FY25.
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