Net profit jumps 64.33% as tax and other income mask softer operations
Revenue was flat YoY, while faster cost growth and a 26.46% rise in interest expense pushed operating margin down 0.53 percentage points.
Filed 29 Apr 2026, 15:34 IST · after market close · Adani Power Ltd (ADANIPOWER)
Key takeaways
- Consolidated net profit rose 64.33% YoY even as operating profit fell 1.67%, helped by other income contributing 40.28% of pre-tax profit and a 2.57% tax rate.
- Operating margin narrowed for a third straight quarter to 33.27%, putting it 1.92 percentage points below the 17-peer Utilities median.
- The stock gained 1.17% in the first session and 2.76% by day five, reversing its recent pattern of six declines in eight results reactions.
Price around the results
Profit growth came from below operating profit
Consolidated revenue was virtually unchanged YoY, while expenses grew 0.70%, causing operating profit to decline 1.67%. Net profit still rose 64.33% because other income contributed 40.28% of pre-tax profit and the tax rate fell to 2.57% from 20.30%. This makes the reported profit growth less representative of the operating performance.
Margin decline reached a third consecutive quarter
Operating margin fell 0.53 percentage points YoY and 0.77 percentage points QoQ as expenses grew faster than revenue in both comparisons. Interest expense also rose 26.46% YoY and 37.98% QoQ. The margin has now declined from 40.29% in Q1FY26 to 38.27%, 34.04% and 33.27% over the next three quarters. It was 1.92 percentage points below the Utilities median across 17 reported peers.
Management linked demand softness to weather and offtake
Management said prolonged monsoons and cooler temperatures subdued FY26 power demand, affecting PPA offtake and average merchant-market rates. The company reported Q4 O&M availability of 91% and PLF of 74%. Management said a greenfield 1,600 MW ultra-supercritical project is planned, while the presentation also noted a 1,600 MW, 25-year Maharashtra DISCOM PPA and a 558 MW, five-year Tamil Nadu DISCOM PPA.
The market reaction was positive but not unusual
The stock rose 1.17% in the first session after the results and was up 2.76% by day five. That first-session move was close to its 0.99% median absolute move after the last eight results, so the reaction was broadly ordinary in size. It nevertheless contrasted with the recent record of six down reactions against two up reactions.
Q4FY26 at a glance
Consolidated figures as filed with NSE — cross-checked against an independent source.
| Line item | Q4FY26 | Q3FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹14,223 cr | ₹12,451 cr | +14.23% | -0.10% |
| Other income | ₹1,766 cr | ₹543 cr | +225.07% | +492.22% |
| Expenses | ₹9,491 cr | ₹8,213 cr | +15.55% | +0.70% |
| Operating profit | ₹4,732 cr | ₹4,238 cr | +11.67% | -1.67% |
| Operating margin (%) | 33.27% | 34.04% | — | — |
| Interest | ₹967 cr | ₹701 cr | +37.98% | +26.46% |
| Depreciation | ₹1,147 cr | ₹1,135 cr | +1.05% | +5.77% |
| Profit before tax | ₹4,384 cr | ₹2,945 cr | +48.86% | +34.43% |
| Tax | ₹113 cr | ₹457 cr | -75.36% | -83.00% |
| Net profit | ₹4,271 cr | ₹2,488 cr | +71.67% | +64.33% |
| EPS (₹) | ₹2.08 | ₹1.29 | +61.24% | -68.58% |
Operating margin of 33.27% compares with a Utilities sector median of 35.19% across 17 peers that have reported Q4FY26.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | +1.17% | +1.92% |
| Next session | +3.66% | — |
| 5 sessions | +2.76% | +2.77% |
| 15 sessions | +0.02% | — |
| 30 sessions | +0.57% | — |
Volume on the results session was 1.04× its 20-day average.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
This quarter
- Q4 FY26 O&M availability was 91% and PLF was 74%.
Guidance & outlook
- The presentation projects a fourfold increase in power demand over the next two decades.
Expansion
- A 1,600 MW ultra-supercritical thermal power project is planned as a greenfield project.
New orders
- APL won a 1,600 MW gross PPA from Maharashtra DISCOM for 25 years.
- Moxie Power Generation was awarded a 558 MW net PPA by Tamil Nadu DISCOM for five years.
New initiatives
- APL issued AA-rated non-convertible debentures through private placement to fund expansion and other corporate purposes.
Competition
- APL describes itself as India's largest private thermal power producer with an 18.15 GW portfolio.
Problems & risks
- Prolonged monsoons and cooler temperatures subdued FY26 power demand.
- Lower demand affected PPA offtake and average merchant-market rates.
What to watch
- Whether operating margin stabilises after falling to 33.27% for a third straight quarter.
- Whether other income remains close to 40.28% of pre-tax profit.
- Whether interest expense moderates after rising 37.98% QoQ.