Adani Power Reports Mixed Q2 Results: Revenue Up, Profit Down
Adani Power's Q2 FY2024 results show a 1.20% increase in revenue to ₹135.00 billion, but a 12.12% decrease in net profit to ₹29.00 billion compared to Q2 FY2023. EBITDA declined by 2.39% to ₹51.50 billion, with the EBITDA margin compressing by 128 basis points to 38.27%. The mixed performance reflects growth challenges and potential cost pressures in India's power sector.
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Adani Power, a key player in India's energy sector, has released its quarterly financial results, showing a mixed performance with increased revenue but a decline in profit.
Financial Highlights
| Metric | Q2 FY2024 | Q2 FY2023 | YoY Change |
|---|---|---|---|
| Revenue | ₹135.00 | ₹133.40 | +1.20% |
| Net Profit | ₹29.00 | ₹33.00 | -12.12% |
| EBITDA | ₹51.50 | ₹52.76 | -2.39% |
| EBITDA Margin | 38.27% | 39.55% | -128 bps |
Revenue Growth Amid Profit Decline
Adani Power reported a modest increase in its consolidated revenue, which rose to ₹135.00 billion in the quarter, up from ₹133.40 billion in the same period last year. This represents a year-over-year growth of 1.20%, indicating a slight expansion in the company's top line.
Profitability Pressures
Despite the revenue growth, the company faced challenges in maintaining its profitability. The consolidated net profit for the quarter stood at ₹29.00 billion, marking a 12.12% decrease from the ₹33.00 billion reported in the corresponding quarter of the previous year.
EBITDA and Margin Compression
The company's EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) also saw a decline, dropping to ₹51.50 billion from ₹52.76 billion year-over-year. This represents a decrease of 2.39%.
Consequently, the EBITDA margin compressed to 38.27% from 39.55% in the previous year, a reduction of 128 basis points. This margin compression suggests increased operational costs or pricing pressures in the power sector.
Market Implications
These mixed results reflect the complex dynamics of the power sector in India. While Adani Power has managed to grow its revenue, the decline in profitability and EBITDA may raise questions about the company's cost management and operational efficiency in the current market environment.
Investors and analysts may closely monitor future quarters to assess whether this performance is a temporary setback or indicative of broader sectoral challenges affecting the company's operations.
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