Crisil Ratings has upgraded its rating on Adani Power Ltd’s (APL) long-term bank facilities from ‘Crisil AA-/Positive’ to ‘Crisil AA/Stable’. The rating agency has also assigned a ‘Crisil AA/Stable’ rating to APL’s proposed non-convertible debentures (NCDs) worth Rs 11,000 crore. The upgrade is based on the agency’s expectation of Adani Power’s credit risk profile strengthening due to an increase in tied-up capacities and fuel linkages, leading to improved revenue and cash flow visibility.
The rating agency highlighted that Adani Power’s business parameters have shown strong improvement, with a debt service coverage ratio (DSCR) of over 2x and a net debt-to-EBITDA ratio of less than 2.5 times. The company has also resolved all major past regulatory issues, resulting in a healthy cash inflow and revenue visibility for future years. Adani Power’s operating performance has been strong, with a plant load factor (PLF) of 65% in fiscal 2024 and 69% in the first nine months of fiscal 2025.
The company’s consolidated net leverage has reduced to 1.4 times as of March 2024 from 3.3 times as of March 2023, and is expected to sustain in the near to medium term due to healthy cash accrual. Adani Power is the largest private sector thermal power producer in India, with an operational portfolio of 17.55 GW of assets located across the country. The upgrade in rating reflects the company’s improved credit profile and is expected to have a positive impact on its future financial performance.