This Adani Group share is among Jefferies India's top 3 picks despite the RBI's 25 bps Repo Rate hike

Jefferies India has placed an unspecified Adani Group share among its three preferred ideas even after the RBI raised the repo rate by 25 bps. Its reasoning is that power companies may be partly insulated from higher borrowing costs through regulated equity returns, fixed rate loans and limited transmission of rate increases. The call comes against weak sector performance, with the power index down 6.3% over one month and 12.4% over three months. The material does not identify the Adani company, its valuation or the timing of the Jefferies note.

For Indian markets, the key issue is whether power utilities can preserve returns as monetary tightening raises funding costs. Regulated equity may support earnings, while fixed rate debt can delay the impact on interest expense and lower pass through can limit immediate pressure. Listed power generators and utilities, including Adani Group power businesses, are directly exposed, while lenders to capital intensive projects may also be affected. The reading would be confirmed by company disclosures showing stable regulated returns, a high fixed rate loan share and contained finance costs. Faster refinancing pressure or stronger rate transmission would weaken it.