Adani Green (ADANIGREEN)

FairStock Score: 45/100 — MIXED

Score breakdown: P/E: 0/3 · ROCE: 0/2 · Growth: 0/2 · Dividend: 0/1

Key Financials

Strengths

• Five-year revenue CAGR of 29.12% demonstrates strong top-line expansion.
• Promoter holding of 62.44% aligns management with minority shareholders.
• Latest quarterly sales of ₹2,618 crore indicate substantial operating scale.
• Piotroski F-Score of 6/9 shows some fundamental robustness despite leverage.
• ROE of 12.24% is reasonable for a capital-heavy power generation business.

Concerns

• Debt/Equity of 4.52 and negative free cash flow of ₹-11,464 crore highlight heavy leverage and cash burn.
• Latest quarter net profit of just ₹5 crore on ₹2,618 crore sales shows extremely thin profitability, with profit growth down 16.01%.
• Valuation is extreme: P/E 94.64, P/B 16.48, EV/EBITDA 582.83, and negative margin of safety versus Graham Number of ₹124.77.
• Altman Z-Score of 1.37 suggests financial distress risk, and zero dividend offers no income support to investors.

AI Analysis

Reading Adani Green's numbers, I am reminded of a very expensive growth story. Yes, the company has grown: five-year revenue CAGR of 29.12% and latest quarterly sales of ₹2,618 crore. Growth of that scale is not easy. But Graham taught me to first protect the downside. This balance sheet does not protect me. Debt/Equity is 4.52, free cash flow is minus ₹11,464 crore, and the Altman Z-Score of 1.37 sits in the danger zone. A business cannot rely on capital markets forever to fund negative cash flows, no matter how attractive the industry narrative. The latest quarter also shows only ₹5 crore net profit on ₹2,618 crore sales—a razor-thin margin—and profit growth is down 16.01%. Meanwhile, the market is paying ₹1,214.60, a P/E of 94.64 and P/B of 16.48, against a book value of just ₹73.68. Graham's number, for what it is worth, is merely ₹124.77, giving a negative margin of safety of over 659%. EV/EBITDA of 582.83 makes no sense to me as a value investor. I like the promoter skin in the game at 62.44% and the 12.24% ROE is acceptable, but the company is spending far more than it earns to achieve growth. There is no dividend to reward a patient shareholder. FairStock Score of 38/100 says MIXED, but a mixed score is not enough when the price already discounts perfection. This is a fast-growing operation, but as an investment it fails my test: an attractive business is not an attractive investment at any price. I would wait for a much lower price, a stronger balance sheet, and proof that profits and cash flows can match the top-line promise.

Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer