Adani Power's Rs 7,500 Crore NCD Attracts Robust Demand from Institutions

Adani Power Limited’s non-convertible debenture (NCD) offering, looking to raise up to Rs 7,500 crore, saw a strong demand among domestic institutional investors across mutual funds, banks and insurance companies for anchor investor allocation, sources told Moneycontrol. The Adani group’s thermal power unit is raising the funds through four NCDs, with maturities ranging from two, three, four and five years and coupon rates in the range of 8 percent to 8.4 percent. Key mutual fund anchor investors were SBI Mutual Fund, ICICI Prudential, Aditya Birla Sunlife, Nippon India, Tata MF, Axis MF, Invesco, and UTI. ICICI Bank and Axis Bank were among the banks that anchored the NCD, which also saw participation from Kotak Mahindra Pension Fund and SBI General Insurance Company. “Adani Power’s stable operating cash flows and clearly visible growth trajectory have emerged as a key draw for institutional bond investors,” one of the sources cited above said. “With an EBITDA of approximately Rs 23,000 crore and net debt of Rs 36,000 crore, Adani Power’s net debt-to-EBITDA stands at 1.5x, well below the industry benchmark of 3.5x–4.0x.” A spokesperson for Adani group could not be immediately reached for a comment. State-owned power company NTPC operates at around 5x net debt-to-EBITDA, while private peers such as Tata Power and JSW Energy are closer to 4x, the source said. Adani Power has guided for capacity expansion to 42 gigawatts (GW) by FY32 from the current 18 GW, supported by strong internal accruals and a disciplined capital structure. “The combination of low leverage, earnings visibility, and attractive risk-adjusted yields is driving sustained appetite among banks, insurers and domestic institutional investors for Adani Group NCDs,” the source said. The group’s flagship entity Adani Enterprises Ltd’s Rs 1,000-crore public NCD offering, launched on January 6, was fully subscribed in the first hour of the launch. Adani group companies have raised around Rs 15,000 crore from domestic bond offerings in the last one and half years, with close to Rs 3,000 crore raised from retail investors, driven by rising appetite for debt alternatives as equity markets have seen prolonged bouts of volatility amid global geo-political tensions and trade headwinds.