Kipre Cheche began the goal party with a brace in the 17th and 19th minutes to send fans of the home team into wild jubilation.
The Ethiopians suffered a major blow when midfielder Eshetu Menna was shown a red card on 21 minutes for a tackle on Jean Mugiraneza.
It appeared over for Adama City in the second half and Azam continued to press for more goals. Abbas Mudathir Yahya took the game beyond the Ethiopians with the fourth goal two minutes from recess, before Aggrey Morris completed the rout by converting a penalty midway.
In a post-match interview, Stewart Hall, head coach of Azam said “we have been professional in our play because we would have avoided any big team in our next fixtures, but we can match any side in this tournament because we have the quality,” referring to the quarters where they are likely to meet fellows Young Africans.
In the other Group C match, Kampala City Council Authority (KCCA) of Uganda beat Malakia of South Sudan 1-0 to go second on six points.
Debutant Isaac Sserunkuuma scored the only goal of the match after 14 minutes to secure the Ugandans a quarters berth.
KCCA (Uganda) 1-0 Malakia (South Sudan)
Azam (Tanzania) 5-0 Adama City (Ethiopia)