Adani Ports Outlook: After the quarterly results, there is a rise in the shares of Adani Ports & SEZ today. The company’s shares have increased by 1 percent today to Rs 818. The company released results for the September quarter on Thursday, which were better than the estimates of experts and brokerage houses. The company’s revenue has increased by about 11 percent on an annual basis. EBITDA increased by 49 percent on an annual basis to Rs 7429 crore. The company recorded a 17% annual growth in cargo volume. After the results, brokerage houses are looking positive on this share of Adani Group. He says that the company is in a leadership position in the port business. It will also benefit from a focus on logistics services.
Share price can go up to Rs 1050. Brokerage house Motilal Oswal has given a Buy rating on the shares of Adani Ports & SEZ and a target of Rs 1050. Considering the current price of Rs 806, one can get a 30% return on the share. The brokerage says that Adani Ports is in the market leader position in the port segment. The company holds a strong position in the industry due to its focus on providing integrated logistics solutions. Operational ramp-up at recently acquired ports is expected to lead to a 13 percent growth in cargo volumes in FY23-25. This may show 20%, 17%, and 12% CAGR growth in revenue, EBITDA, and PAT in FY23-25. The brokerage believes that due to the better outlook of the port and logistics business, the company’s EBITDA growth maybe 10% and 3% in FY24/FY25.
The brokerage says that the revenue of Adani Ports and SEZ Limited grew by 28 percent on an annual basis during 2QFY24 and reached close to Rs 6650 crore, which is 11 percent more than the estimates. The company recorded a 17% YoY growth in cargo volume to 101.2 MMT (flat QoQ). EBITDA margin came in at 58.4% in 2QFY24, while it was expected to be 62.6%.
Talking about global brokerage house, Jefferies has maintained a Buy rating on Adani Ports and has given a target of Rs 985. Whereas CLSA has given a buy rating on Adani Ports and a target of Rs 878.
How were the company’s results?
In the second quarter of the financial year 2024, the profit of Adani Group company Adani Ports and Special Economic Zone (Adani Ports) has increased marginally. The company’s consolidated profit during this period has increased by 4.19 percent to Rs 1747.85 crore. Adani Ports had made a profit of Rs 1677.5 crore in the same quarter a year ago. The total expenses of the company also increased to Rs 4477 crore in the September quarter, which was Rs 3751.54 crore in the second quarter a year ago.
The company’s total revenue from operations increased by 27.55 percent on an annual basis to Rs 6646.41 crore, which was Rs 5210.8 crore in the same quarter a year ago. The company’s operating margin stood at 58 percent at the end of the September quarter and declined by 63 percent year-on-year. Net profit margin declined from 33 percent to 27 percent on an annual basis. In the first 6 months of FY24, the company’s revenue increased by 26 percent year-on-year to Rs 12,894 crore, while EBITDA increased by 49 percent year-on-year to Rs 7429 crore. Port EBITDA margin increased by 220 bps to 72 percent.
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