Adani’s Coal-Power Arm Posts 847% Jump in Profit on High Demand

(Bloomberg) -- Billionaire Gautam Adani’s coal-power unit said its profit jumped almost ten-fold in the second quarter as an increase in electricity demand boosted sales. Its shares jumped.

The company’s net income soared to 65.9 billion rupees ($792 million) from just about 7 billion rupees a year earlier, Adani Power Ltd. said in an exchange filing Thursday. Fuel costs on each unit of power sold declined, aiding earnings. Its shares rose as much as 7.7% in Mumbai, before paring gains.

The three-month period that ended in September saw a 13% surge in India’s electricity demand as poor monsoon rains in August spurred the use of cooling appliances and irrigation pumps. Major power producers, such as NTPC Ltd., JSW Energy Ltd. and Adani Green Energy Ltd., have also reported a jump in profit.   

Greater capacity utilization resulted in a 65% rise in Adani Power’s electricity sales, according to the statement. The start of its 1.6-gigawatts Godda plant, which supplies power to Bangladesh, also helped the company, it said.

Adani Power’s fuel costs advanced to 67.6 billion rupees, although these expenses declined nearly 22% for each kilowatt hour of sales, according to Bloomberg calculations.

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