Adani Green Energy Ltd (ADANIGREEN) Q2 FY27 Earnings Call: Crosses 20 GW Milestone, Reaffirms Rs. 2.4 Lakh Crore Capex

Adani Green Energy Ltd held its Q2 FY27 earnings call on October 21, 2026. Here's a quick read of what management said — performance, strategy, and the outlook ahead.

20 GW Milestone Crossed; Strong H1 Growth Despite Curtailment

• 20.8 GW operational portfolio — AGL crossed the 20 GW milestone in H1 FY 2026-2027, supplying clean power equivalent to 4.4 million+ homes and avoiding 17.5 million tonnes of CO2; energy sales rose 32% YoY to 25.7 billion units on 24% YoY higher greenfield capacity addition.
• Q2 FY 2026-2027 power supply revenue up 45% YoY — to Rs.4,019 crore, with power supply EBITDA up 51% YoY to Rs.3,835 crore at a 92% margin.
• H1 FY 2026-2027 power supply revenue up 36% YoY — to Rs.8,299 crore; power supply EBITDA up 41% YoY to Rs.7,957 crore at an industry-leading 93% margin; total EBITDA Rs.8,276 crore, which management said would have been close to Rs.9,000 crore absent curtailment.
• Q2 EBITDA outpaced generation — Dhruv Muchhal (HDFC AMC) cited ~33% YoY generation growth vs ~51% EBITDA growth for Q2 FY 2026-2027; management attributed the gap to battery storage earnings flowing in, better wind generation vs Q2 FY 2025-2026 (lower rains), and untied wind capacity selling into merchant markets at improved prices.
• Merchant realization uplift — merchant/infirm power rates improved to ~Rs.2.4 in Q2 FY 2026-2027 from ~Rs.2.1 in Q2 FY 2025-2026.
• Solar CUF dip — 1H FY 2026-2027 solar CUF declined to ~23% from 24.8% in 1H FY 2025-2026, predominantly on curtailment (seasonality secondary); CUF expected to normalize once the evacuation corridor is available.
• Cost discipline — CFO Saurabh Shah noted Q2 FY 2026-2027 operating costs did not rise in line with revenue growth, with O&M and employee costs rationalized; CEO Ashish Khanna credited digitization and technology investments for better profits from the same fleet.

Khavda Evacuation Slips to Q4; Curtailment Framed as Temporary

• First 7 GW Khavda evacuation line delayed — now expected to commission in Q4 FY 2026-2027 (vs Q3 FY 2026-2027 earlier); CEO Ashish Khanna said the second 7 GW line "further looks to be delayed," with management focused on the first corridor.
• Phase 3 corridor expected by Q4 FY 2026-2027 — CEO Khanna expressed no doubt on the credibility of AESL and Power Grid on transmission lines; right-of-way (ROW) issues remain the key constraint, with both the state and central government focused on resolution. The corridor is outside AGEL's control.
• Curtailment seen as a 3-6 month issue — CFO Saurabh Shah said curtailment will last "not more than 3-6 months"; the previously guided December timeline has shifted to nearer March (Q3 to Q4 FY 2026-2027) — a few months' slip, not a year, which does not change the leverage profile of a 25-year asset.
• Take-or-pay protection — all signed PPAs are on a take-or-pay basis, and any curtailment from the grid specific to AGEL is compensated as deemed generation, applicable to all PPAs signed.
• AESL terms clarified — AGEL is paid for all scheduled power not taken by the procurer (same terms as SECI) and for grid-directed backdown after scheduling; only power that cannot be scheduled goes unpaid, with scheduling done in 15-minute blocks. Rajat Seksaria illustrated: with 2 GW generated but only 1 GW evacuable at Khavda, scheduled volume within the 1 GW is payable even if not offtaken.
• H2 FY 2026-2027 curtailment expected lower — management has accelerated battery storage build-out at Khavda and expects the curtailment impact in H2 FY 2026-2027 to be lower than in H1 FY 2026-2027.

BESS as "Virtual Transmission"; 10 GWh FY27 Target

• 6.6 GWh total installed storage — commissioned 3 GWh of BESS at Kharda in Q2 FY 2026-2027, taking total storage to 6.6 GWh, more than 50% of India's operational base; on track to exceed 10 GWh in FY 2026-2027.
• 3.5 GWh of the 10 GWh FY 2026-2027 battery program tied up — under long-term contracts as of Q2 FY 2026-2027 (per CFO Saurabh Shah, correcting the CEO's initial 3.3 figure); as of 30 Sep 2026, a further 3.1 GWh is in process, totaling 6.6 GWh; required solar/wind input power is already secured.
• Batteries underwritten at 13-14% returns — installed for peak power and RTC supply as long-term assets, with counterparties required to be AA+-rated on SECI-like PPA terms under 25-year agreements (e.g., government discoms, EESL); allocation between AESL and other hybrid/FDRE counterparties will be decided by counterparty rating and return expectations, not a pre-committed split.
• Absorption rule of thumb — Rajat Seksaria (CEO-BPS) said dividing GWh by ~4.5-5 implies ~2-2.5 GW of solar absorbed irrespective of transmission availability, assuming 10 GWh closes by end of FY 2026-2027; actual absorption is more nuanced, depending on solar curve, season, and tracker vs fixed-tilt mix.
• Fast deployment as mitigation — battery plants executed in 8-10 months (largest in the world), a "virtual transmission" tool requiring minimal land; Adani Green accounts for roughly 50% of all battery deployments in India to date (FY 2026-2027).
• Chitravathi pumped storage — the maiden 500 MW project is progressing toward completion by end of FY 2026-2027; BPS (pumped storage) development has been significantly accelerated to insulate from transmission network delays.

Rs.2.4 Lakh Crore Program Reaffirmed; Leverage Path to Sub-4x

• Rs.2.4 lakh crore capex program reaffirmed — CEO Ashish Khanna said there is no change in allocation or timing (period unspecified) despite H1 FY 2026-2027 acceleration; management does not "foresee any challenge" to achieving it, and battery storage "is only going to add on" rather than redirect the plan.
• Leverage at 5.6x as of Q2 FY 2026-2027 — CFO Saurabh Shah said it will remain in this range until nearer FY 2027-2028–FY 2028-2029; beyond FY 2029-2030, leverage moves into the 4.5x-5x range, then towards 4x and below 4x in later years as amortization "automatically pays for itself."
• Portfolio at capex completion — with the larger capex completing between FY 2028-2029 and FY 2029-2030, the company will have about 45 GW of RE capacity, 5 GW of pumped storage, and nearer 40-50 GWh of batteries, with leverage on the overall EBITDA base reaching ~4.5x before tapering.
• Project-finance structure — all loans are on a project-finance basis and all financed projects have serviced interest and repayment; a 3-6 month curtailment-driven EBITDA variation does not materially change the leverage profile.
• Debt insulation from rate cycles — 72% of project loans are fixed rate for a medium-to-long term (3-5 years), and the 25-year fixed tariff PPA structure means rate cycle changes do not materially affect project returns.
• Hedging policy unchanged — loan book is ~70% rupee and ~30% dollar as of Q2 FY 2026-2027; within the dollar book, principal plus interest is fully hedged per lender documents; one RG2 asset is hedged through FY30, RG1 hedging is in place till FY28 and will be rolled for a further 3-5 year tenor.

Blended Cost Down 220 bps Since 2019; AG23L Upgraded to AAA

• Blended interest rate down from 11.1% in 2019 to 8.9% currently — a reduction of over 220 bps across 7 years; the cost held at 8.9-8.95% over the six months through Q2 FY 2026-2027, level with the ~8.9% reported in March 2026 (FY 2025-2026), despite ~10 GWh of battery under construction and ~5 GW of solar-wind capacity in the pipeline.
• AG23L upgraded to AAA — the SPV (~15% of Adani Green's overall EBITDA) saw a 7-notch improvement over the last 5 years, with its interest rate falling from ~10-11% to 8.4% currently; the AA+ to AAA conversion (underway as of Q2 FY 2026-2027) is expected to reduce its borrowing cost by 20-25 bps.
• Rating mechanics — under-construction SPVs are typically rated BBB- to A; upon operationalization, ratings move to AA, delivering ~50 bps interest cost reduction per notch upgrade.
• Portfolio mix shifting — operating capacity stands at 20 GW with 5-8 GW under construction (~30% of total portfolio); management expects the under-construction share to fall to 20% or 10% once operating capacity reaches 30 GW (period unspecified), tapering interest-rate sensitivity.
• 13-14% ROI target on FY 2026-2027 PPAs — defined as EBITDA divided by cost of asset (ROA), translating into a higher ROE given the 75:25 leverage structure; the EBITDA-vs-EBIT distinction is minor (~4%) given the 25-30 year asset life.

FY27 Commissioning Target Held; Merchant Risk Being Eliminated

• 4.5-5 GW commissioning target for FY 2026-2027 maintained — management reaffirmed its beginning-of-FY target, contingent on the Phase 3 transmission corridor being available by Q4 FY 2026-2027; balance-of-system infrastructure is fully invested so modules can be deployed at 20-30+ MW/day once corridor availability is certain.
• 10 GWh battery target for FY 2026-2027 — management is committed to commissioning the 10 GW battery target by end of FY 2026-2027 and is confident of surpassing it; capex has been redirected toward batteries as transmission corridors take longer.
• Merchant-to-PPA shift on solar — capacity sold on merchant basis through FY 2025-2026 is now locked into a 25-year PPA with AESL at Rs.2.70/unit, versus current merchant solar realization of Rs.2.34-2.40/unit (Q2 FY 2026-2027); management is eliminating merchant tariff risk, choosing to carry only execution risk over the next 5-7 years of capex.
• Wind tied at Rs.3.93/unit for 25 years — per the business update issued after the Q1 FY 2026-2027 call, close to the ~Rs.4+ average merchant wind realization achieved in FY 2025-2026; the fixed tariff removes seasonal wind price volatility while preserving returns.
• Khavda Phase 6/7 and FY30 commitment — management confirmed scheme-level developments are underway and stated the company is committed to surpassing its stated FY30 target; battery storage was cited as a key mitigation against potential Phase 6 delays, with Rajasthan among other states being evaluated for additional capacity.
• India demand backdrop — management cited India's ~308 GW of installed non-fossil capacity (more than 54% of total installed power capacity) progressing toward the 500 GW target by 2030, with peak demand reaching new highs on industrial growth, electric mobility, data centers and electrification; opportunities seen from firm and dispatchable renewable energy needs, AI/data center/hyperscaler demand, and C&I demand for integrated renewables-plus-storage.
• Counterparty discipline — the company remains firm on a 13-14% ROA return threshold (standing policy) and seeks long-term 25-year tie-ups with AA+ rated sustainable partners; AESL has been the C&I partner in the past and could be in the future as well.