Gautam Adani-backed Power Company and Druk Green Power Sign Deal for 570 MW Wangchhu Hydroelectric Project in Bhutan

Adani Power Limited (APL), India’s largest private power producer, and Druk Green Power Corporation Ltd. (DGPC), Bhutan’s state-owned generation utility, have signed a Shareholders Agreement (SHA) to establish a 570 MW hydroelectric project at Wangchhu in Bhutan. The agreement was finalised on September 5, 2025, in the presence of Bhutan’s Prime Minister, Dasho Tshering Tobgay, and Mr. Gautam Adani, Chairman of the Adani Group. The signing also included the initial understanding of a Power Purchase Agreement (PPA) and a Concession Agreement (CA) with the Royal Government of Bhutan. The project is expected to play a critical role in enhancing renewable energy capacity in the region.

The Wangchhu hydroelectric project is planned as a peaking run-of-river project, following the BOOT (Build, Own, Operate, Transfer) model. The total investment is estimated at Rs 60 billion. Construction will begin in early 2026 and is expected to conclude within five years.

APL and DGPC will set up a new project company in Bhutan, with DGPC holding 51 per cent and APL holding 49 per cent. The company will initially issue 5.1 million shares to DGPC and 4.9 million shares to APL at BTN 100 per share. Governance will be equally shared, with both parties nominating three directors each to the board.

According to Mr. SB Khyalia, CEO of Adani Power, the project will help meet Bhutan’s peak winter electricity demand while enabling power exports to India during the summer. Dasho Chhewang Rinzin, MD of DGPC, emphasised that reliable electricity access is key to Bhutan’s goal of becoming a High Income GNH country within the next decade. Bhutan is targeting 15,000 MW of new hydropower capacity and 5,000 MW of solar capacity by 2040.

This project is the first under the MoU signed in May 2025 between the Adani Group and DGPC for the development of 5,000 MW of hydropower in Bhutan. Both entities are already in talks for additional projects, which could further strengthen energy cooperation between the two nations.

Adani Power, part of the Adani portfolio, currently operates 18,110 MW of thermal capacity across twelve power plants, along with a 40 MW solar plant in Gujarat. The company continues to diversify in renewable energy while also being active in Large-Cap power generation. DGPC, established in 2008, manages more than 2,500 MW of capacity and has begun expanding into solar energy.

Hydropower cooperation between India and Bhutan has been ongoing since the 1960s, providing economic benefits and reliable electricity supply to both nations. The Wangchhu project further strengthens this historic partnership while creating opportunities for future investments similar to IPO-linked infrastructure projects, right issue funding structures, and possible dividend benefits from joint ventures.

About the Company

As the largest private thermal power producer in India, Adani Power (APL) operates with a total installed capacity of 18,110 MW across twelve thermal power plants and one 40 MW solar plant. The company's facilities are located in multiple states, including Gujarat, Maharashtra, Karnataka, and Rajasthan. Adani Power leverages technology and a team of experts to help transform India into a power-surplus nation, with the goal of providing affordable and reliable electricity nationwide.

The company has a market cap of over Rs 2 lakh crore and has delivered good profit growth of 65.3 per cent CAGR over the last 5 years. The shares of the company have a PE of 18x, an ROE of 26 per cent and an ROCE of 23 per cent. The stock is up by 40 per cent from its 52-week low of Rs 430.85 per share and has given multibagger returns of over 1,400 per cent in 5 years.

Disclaimer: The article is for informational purposes only and not investment advice.