Adani Power rally in 2026: why valuation leads peers

Adani Group back in the spotlight

Adani Group stocks have remained a high-attention pocket in Indian markets, swinging between sharp rallies and equally sharp drawdowns. In one session cited in market coverage, the Sensex and Nifty ended lower amid a rout in Adani stocks, with the market capitalisation of 11 Adani companies falling by Rs 2.25 lakh crore. Yet within the same broader universe, Adani Power has frequently stood out as an exception on weak days. The divergence has kept investors focused on what is driving the rerating in select Adani names while others track sentiment and news flow.

Adani Enterprises: green hydrogen pilot and near-term moves

Adani Enterprises, the group’s flagship listed company, drew attention after an Adani Enterprises unit commissioned India’s first off-grid green hydrogen pilot plant. On the day referenced alongside that update, Adani Enterprises shares were indicated to be up 1.5%. The stock’s recent trend, however, has been mixed: it has gained over 6% in the past six months but fallen more than 2% in the past five days. In broader tape action described in the same context, 11 out of 12 Adani stocks were trading in the red at one point, with Adani Power being the only exception.

Adani Power’s 2026 surge and ‘most valuable’ tag

A near-50% rise in 2026 has been described as turning Adani Power into India’s most valuable listed power company. One report pegged its market capitalisation at Rs 4.24 lakh crore, ahead of NTPC’s Rs 3.9 lakh crore, and also called it the most valuable company within the listed Adani group. Another market update highlighted a separate milestone: shares of Adani Power surging as much as 37% over 13 sessions, with market capitalisation cited at Rs 3.93 lakh crore, surpassing Adani Ports at Rs 3.70 lakh crore. Across these snapshots, the common thread is the market’s willingness to award Adani Power a premium despite the presence of a much larger state-owned peer.

Why the market is paying up: demand, utilisation, and merchant exposure

The rerating narrative has been linked to strong earnings growth, rising electricity demand, and steady institutional accumulation. Adani Power’s plant load factors (PLFs) were cited at an estimated 75-85%, ahead of NTPC’s 70-77%. Unlike NTPC, which largely operates under regulated return frameworks, Adani Power retains meaningful exposure to short-term merchant markets and peak-demand tariffs, which can lift earnings during periods of demand stress. In the same line of argument, Adani Power has been described as a direct beneficiary of an “electricity supercycle” in India.

Capacity expansion plans and the PPA mix

On capacity, the contrast with NTPC is notable. NTPC operates over 80 GW of installed capacity, nearly four times Adani Power’s 18.2 GW. Even so, Adani Power’s management targets were cited as 31 GW by 2030 and 42 GW by 2032, implying a steep expansion path from current levels.

Credit commentary has also been used to support the visibility argument. According to CRISIL Ratings, the company has resolved major regulatory issues and recovered most of its pending dues, improving cash flow and revenue visibility. More than 95% of Adani Power’s operational capacity is now tied up through long-term and medium-term power purchase agreements (PPAs). Additionally, 56% of its under-construction capacity has been secured through agreements with state discoms.

Institutional ownership: steady build-up over six quarters

One of the more measurable supports for the rerating has been the increase in institutional holdings. Mutual fund ownership in Adani Power rose over six quarters from 1.6% in December 2024 to 3.62% in March 2026. Broader institutional ownership also increased over the same period from 15.55% to 19.04%, a move described as a near 350 basis point rise. The cited takeaway is that the move has not been driven only by short-term price momentum.

What brokerages and technicians highlighted

Jefferies was cited among the most bullish voices, raising its price target to Rs 255 from Rs 185 and lifting its multiple to 20x FY28 estimated earnings from 18x September 2027 estimates, citing rising power demand and growth prospects for the next 3-4 years. The same note described a 100% premium to NTPC’s implied 10x multiple, citing faster growth and merchant upside.

Separately, Morgan Stanley was reported to have initiated an “overweight” rating on Adani Power with a target price of Rs 818, implying 30% upside potential, and pointed to resolved regulatory issues, completed value-accretive acquisitions, and expected earnings growth from timely projects and new PPAs. Technical commentary in the same news flow flagged the sharp upmove toward the Rs 190-200 zone, with immediate support around Rs 170-175 and a stronger base near Rs 150.

Other Adani-linked updates moving the tape

Outside power, Adani Energy Solutions signed a share purchase agreement with a subsidiary of REC to acquire 100% stake in Mahan Transmission Limited (MTL). In renewables, Emkay Global initiated coverage on Adani Green Energy with a ‘buy’ rating and a target price of Rs 2,550 per share, though the stock was also noted as slipping 4% due to controversy around a new Hindenburg Research report.

Other company-specific data points in the group included Adani Total Gas reporting a 9% YoY decline in Q2 net profit to Rs 162 crore from Rs 178 crore, with input gas costs rising 26%. Adani Green Energy reported a 28% YoY rise in Q2 FY26 consolidated net profit to Rs 644 crore from Rs 515 crore, while revenue from the power supply segment increased to Rs 2,776 crore from Rs 2,308 crore.

Key figures at a glance

Risks and what investors are watching

Even bullish notes highlighted risks. Jefferies flagged the potential resurfacing of past PPA disputes, a sharp drop in merchant realisations, demand disappointment, and payment delays from the 1.6 GW Godda plant that supplies power to Bangladesh under PPAs. Separately, broader Adani sentiment has also been influenced by regulatory and investigative headlines. SEBI, in two detailed orders referenced in market reports, concluded there was no evidence of insider trading, market manipulation, related-party fund routing to inflate share prices, or violations of public shareholding norms in the case triggered by the January 2023 Hindenburg report.

Conclusion

The current Adani Group narrative is being shaped by a mix of operational execution and headline-driven volatility. Adani Enterprises’ off-grid green hydrogen pilot adds to the group’s energy-transition messaging, while Adani Power’s sharp valuation rerating is being underpinned by high utilisation, a capacity growth roadmap, and rising institutional ownership. The next set of signals investors will track are project timelines, demand and merchant price trends, and any further regulatory or legal developments referenced in ongoing market coverage.