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Business & Stocks Livemint Markets & Economy • Oct 08, 2026

Jefferies INDIA Maintains Bullish Stance on Adani Power Amid RBI Repo Rate Hike Cycle

💡 Key Takeaways

•Jefferies India lists Adani Power as a top 3 sector pick.
•Fixed-rate debt and regulatory equity provide a hedge against RBI rate hikes.
•Power sector utilities show higher resilience to monetary tightening compared to other industries.

NEW DELHI [NCRBuzz Wire] — ### Market Outlook and Interest Rate Sensitivity

**Jefferies India has reaffirmed its positive outlook on Adani Power, categorizing it among the top three picks in the power sector despite the RBI's 25 bps repo rate hike.** The brokerage highlights that power utilities benefit from a unique regulatory mechanism that allows for the pass-through of costs, mitigating the impact of higher borrowing expenses.

### Financial Resilience Metrics

| Metric / Aspect | Strategic Advantage |

|---|---|

| Debt Structure | Fixed-rate loans minimize volatility |

| Regulatory Equity | Guaranteed returns on equity capital |

| Cost Pass-Through | Mechanism to offset interest rate hikes |

| Sector Outlook | Defensive positioning in high-rate cycles |

**The report emphasizes that the company's capital structure is optimized to withstand macroeconomic headwinds.** By leveraging fixed-rate debt, Adani Power reduces its exposure to the floating interest rate environment currently dictated by the RBI's monetary policy committee.

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🏛️ Background Context

The RBI has been navigating a complex interest rate cycle to manage inflation, impacting capital-intensive sectors. Power companies often utilize long-term power purchase agreements (PPAs) that include 'change in law' clauses, allowing them to pass on increased costs to distribution companies.

💡 Citizen & Commuter Quick Explainer (FAQ)

Q1: Why does a repo rate hike affect power companies?

A repo rate hike increases the cost of borrowing for companies, which can squeeze profit margins if the debt is floating-rate rather than fixed-rate.

Q2: What protects Adani Power from interest rate volatility?

The company utilizes fixed-rate debt structures and regulatory equity frameworks that allow for cost pass-throughs, insulating it from immediate market rate fluctuations.

Q3: What is the significance of Jefferies' report?

It provides institutional investors with a risk-adjusted outlook on the power sector, identifying companies that remain fundamentally strong despite macroeconomic tightening.

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