Adani Energy Solutions Shares Set for Massive 129% Surge, Says Cantor – Multibagger Potential Ahead

Adani Energy Solutions has not seen significant stock growth this year, but analysts believe it could soon deliver huge returns. According to brokerage firm Cantor, the stock has an ‘Overweight’ rating with a target price of ₹2,251, suggesting a 129% increase by FY26.

Cantor expects the company’s revenue to grow by 20% annually from FY24 to FY27, with adjusted EBITDA rising by 28.8% each year. They compared Adani Energy’s value to similar companies, finding its trading multiple to be higher but justified by faster growth. While peers trade at a 10.9x EV/EBITDA multiple for FY26, Adani Energy trades at 12.8x. Based on this, Cantor set a price target of ₹2,251 using a 26.5x EV/EBITDA multiple for FY26.

The transmission business is expected to grow quickly as it completes nine new projects in the next 18-24 months. The distribution business should also grow at nearly double-digit rates as it increases its regulatory asset base.

For the June 2024 quarter, Adani Energy reported a net loss of ₹824 crore, compared to a ₹175 crore profit the previous year. However, revenue increased by 47% to ₹5,379 crore. Although Adani Energy is valued higher than its peers, its faster growth makes it a strong competitor. The company’s recent capital raise ensures it has the funds to support growth across its major sectors.

Cantor believes that, despite being more expensive, Adani Energy is a good buy at current levels. They see the stock as undervalued, trading at a 60% discount compared to similar companies, and believe it should be valued more fairly in line with its peers.