Adani group faces rough road ahead over debt cut

Adani Enterprises stock falls 20% in a single day

The Supreme Court order on compensatory power rates could make it difficult for the Adani Group to deleverage its balance sheet. Nearly half of the group’s Rs 1.1-lakh crore combined debt of its listed companies is accounted for by Adani Power.

The Central Electricity Regulatory Commission (CERC) had in April 2013 allowed higher rates for Adani Power’s 1,980 Mw Mundra power project, to compensate for rising coal prices. As a result, Adani Power’s operating profit climbed from Rs 1,174 crore in 2012-13 to Rs 8,754 crore in 2015-16 and it turned profitable (on a net basis) beginning 2013-14, despite a