Adani Green's Net Debt Reaches ₹1.03 Lakh Crore Following Capacity Expansion Investments

Adani Green Energy’s net debt rose 35 per cent year-on-year to ₹1.03 lakh crore at the end of September 2026. The renewable energy company stated that around 72 per cent of its project loans carry fixed interest rates, which limits the impact of interest-rate fluctuations on a substantial portion of its borrowings as it continues to expand its capacity.

The company’s net debt stood at ₹1,02,973 crore as of September 2026, compared with ₹76,071 crore in the first half of FY26 and ₹91,252 crore at the end of March 2026. This increase reflects ongoing investments in new renewable energy capacity, including battery storage projects. Debt associated with projects under construction rose faster than debt linked to operational assets. Specifically, debt attributable to operational assets grew 27 per cent year-on-year to ₹78,656 crore, while debt associated with projects under construction surged 73 per cent to ₹24,317 crore. Net debt stood at 5.6 times run-rate EBITDA.

During an earnings call with investors, a senior company executive explained that 72 per cent of their project loans are fixed-rate borrowings for medium- to long-term periods of three to five years, shielding a major portion of loans from the rate-cycle effect. The executive added that the company’s 25-year fixed-tariff power purchase agreements (PPAs) provide revenue visibility, which further limits the impact of short-term interest-rate movements on project returns. As projects transition from construction to operations, their credit ratings typically improve, enabling the company to refinance debt at lower rates.

Adani Green’s average interest cost declined to 8.9 per cent in September 2026 from 11.1 per cent in 2019, marking a reduction of more than 220 basis points despite broader fluctuations in the interest-rate cycle. Management commentary and investor presentations indicated that projects under construction usually receive ratings in the BBB- to A category, which can improve to the AA category upon becoming operational. This transition can lower borrowing costs by approximately 50 basis points. The company highlighted AG 23L, a special purpose vehicle contributing nearly 15 per cent of its overall EBITDA, as an example; its rating has risen by seven notches over five years to AAA, reducing its interest cost from 10-11 per cent down to 8.4 per cent.

The senior executive noted that the interest-rate impact is larger during the construction phase before tapering off. Approximately 30 per cent of Adani Green's portfolio is currently under construction, including battery storage projects. The company expects this share to decrease to 10-20 per cent once its operational capacity reaches 30 GW, as more projects begin generating revenue. As of September 2026, Adani Green had 20.8 GW of operational capacity and is targeting 50 GW by 2030. The firm added 4,083 MW of capacity in the first half of FY27 and operationalised 3,081 MWh of battery energy storage capacity at Khavda during the September quarter, bringing its installed storage capacity to 6,632 MWh.

"The rise in Adani Green's net debt highlights the capital-intensive nature of large-scale renewable energy and infrastructure expansion. However, maintaining a significant portion of fixed-rate borrowings and long-term power purchase agreements provides a necessary buffer against interest rate volatility. For capital-heavy businesses, managing the transition from the construction phase to operations is critical, as improved credit ratings and refinancing opportunities ultimately help optimize borrowing costs over time." — Dr. Shishir Gupta, Founder & CEO, StartupLanes