MUMBAI– Shares of Adani Energy Solutions Ltd rose as much as 2.5 percent on Thursday, outperforming broader market weakness after Morgan Stanley initiated coverage on the stock with a bullish outlook.
The global brokerage assigned an “overweight” rating and set a price target of Rs 1,133, implying a potential upside of about 16 percent from the previous session’s closing price. The stock traded as high as Rs 1,013 during the session.
Morgan Stanley views Adani Energy Solutions as a key beneficiary of India’s long-term power grid expansion, pointing to more than Rs 10 trillion in expected transmission investments over the next decade. The brokerage also highlighted supportive policy measures in power distribution, particularly around smart metering, including subsidies and initiatives aimed at increasing private-sector participation.
The report emphasized the company’s execution track record, noting its ability to deliver projects on time and within budget. It also highlighted Adani Energy Solutions’ integrated presence across transmission, distribution, and smart metering, positioning the company as an end-to-end grid infrastructure platform.
Adani Energy Solutions is described as a leading private-sector player in transmission and distribution, with close to a 50 percent share of private transmission projects. The company serves about 3.3 million consumers through its distribution operations in Mumbai and the Mundra special economic zone, and has built a meaningful presence in the smart metering segment.
Morgan Stanley estimates the company’s EBITDA will grow at a compound annual rate of 21 percent between FY25 and FY30, reaching approximately Rs 2,600 crore by FY30. Growth is expected to be driven by new transmission project wins, regulated capital expenditure in distribution, and execution of its smart metering order book.
Transmission is seen as the strongest near- to medium-term growth driver, supported by an in-hand order book of around Rs 7,800 crore as of the third quarter of FY26. The brokerage assumes the company could win roughly 20 percent of new tariff-based competitive bidding projects, representing a potential annual opportunity of about Rs 20,000 crore.
In distribution, opportunities are expected to emerge from parallel licensing, with the company targeting a 20 percent market share. The regulated asset base is projected to grow at an annual rate of about 11 percent, supported by annual capital expenditure of roughly Rs 1,600 crore.
In smart metering, Adani Energy Solutions is also targeting a 20 percent market share. Its order book of 24.6 million meters is expected to be largely executed by FY27, with smart metering contributing around 9 percent of EBITDA in FY28, excluding non-IFRS adjustments.
Market sentiment toward Adani group stocks has been improving, with several companies, including those in power, ports, green energy, and infrastructure, reporting strong earnings growth over the past two to three years. Morgan Stanley has also initiated coverage on other Adani group companies, reflecting confidence in their underlying business models. (Source: IANS)
