Tag: Adani Ports and SEZ

Citi expects Adani Ports shares to rise 28%, opens positive catalyst watch

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Shares of Adani Ports & Special Economic Zone (APSEZ) Ltd. will be in focus on Tuesday (April 2) as global brokerage firm Citi remains positive on the stock, in fact, they are opening a 90-day positive catalyst watch on the counter.

Citi has raised its target price on the Adani Ports stock from ₹1,564 per share to around ₹1,758 apiece, suggesting another potential upside of as much as 28% from Monday’s closing price.

Citi in its latest note said that Adani Ports is likely to report a strong quarter in its Q4FY24 earnings, with positive volumes, revenue, EBITDA growth and good cash flow.

The strong volume growth should lead to core-port EBITDA growth of about 29% year-on-year, while consolidated EBITDA and profit before tax is expected to grow 27% and 24% on-year.

The global brokerage added that valuations were still reasonable at 30 times P/E (price-earnings) and 19 times EV/EBITDA on FY25 estimates. Citi believes these valuations leave ample room for upside given quality and scale of underlying business.

Further, Citi highlighted that Adani Ports emerged stronger post a short-seller report last year with a strong business momentum, reduced leverage and increased market dominance.

Also, Morgan Stanley has maintained its ‘Overweight’ rating on the Adani Ports stock, with a target price of ₹1,576 per share. The foreign brokerage said the volume growth for the financial year gone by beat the guidance with eight on 10 ports reporting double-digit growth.

Adani Ports reported its highest-ever monthly cargo volume of 38 million metric tonnes (MMT) in March, it said in an exchange filing on Monday.

With this, the company has handled 420 MMT cargo globally in the financial year 2024, well above the 370-390 MMT it had guided for in January 2024. Adani Ports revised its financial year 2024 guidance in January to 370-390 MMT from 350-370 MMT earlier.

On Monday, shares of Adani Ports settled 2.69% higher at ₹1,378 apiece on the NSE. The stock has gained over 30% so far this year, while it is up 120% over the last 12 months.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Adani Ports shares at ₹1,600? Motilal says company well-positioned to beat FY24 guidance

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Adani Ports and Special Economic Zone Limited clocked a cargo volume of 382 million metric tonnes (MMT) in the 11 months of this fiscal (11MFY24), recording a 24% year-on-year (YoY) growth. With a monthly cargo run rate of 35 MMT, domestic brokerage firm Motilal Oswal Securities expects Adani Ports to surpass even its revised cargo volume guidance of 400 MMT during FY24.

The logistics business, Motilal said, continues to do well, with year-to-date rail volume up 21% YoY in FY24.

The domestic brokerage has maintained its ‘Buy’ rating on the Adani Ports stock and revised its target price to ₹1,600 per share, suggesting another 21% potential upside ahead for the counter.

Adani Ports has a diversified cargo mix along with sticky cargo and customer base, Motilal said. It continues to gain market share while generating strong cash flows and maintaining its leverage position, with a net debt-to-Ebitda ratio of 2.5 times, the brokerage said while increasing its volume estimates for the Adani Group company by 2-3% for FY24-26.

Over FY24-26, Motilal expects the port operator and logistics company to register a 10% volume growth and a CAGR of 15% in sales, 16% in Ebitda and 18% in profit after tax.

Global broking firm HSBC has also assigned a ‘Buy’ rating on the Adani Ports stock, saying robust throughput growth continued in February 2024. It said the company is on track to beat its 400 MMT target for FY24.

Given that the company continued its strong growth in February, HSBC has raised its EBITDA forecasts for Adani Ports by 1-4% for FY24-26, implying a 19% CAGR.

The foreign brokerage has raised its target price to ₹1,560 from ₹1,370 per share, with a potential upside of 18%.

Citi Research, meanwhile, in its note said the company is well positioned to grow reasonably faster than industry due to its presence across both coasts of India.

Citi has a ‘Buy’ recommendation on the counter with a target price of ₹1,564, implying a further upside of 11.7% from the current market levels. Adani Ports remains Citi’s top pick in India infrastructure space.

“A big part of the strategy is to grow sticky cargo by providing customised services — customised infrastructure at ports, dedicated inland logistics such as trains and multi-modal logistics parks — and strategic joint ventures with large customers in global shipping lines,” the brokerage noted.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Adani Ports Q3 Results: Net profit rises nearly 70%, margin expands by 600 bps

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Shares of Adani Ports & Special Economic Zone Ltd. erased losses to surge to the day’s high after reporting its December quarter results on Thursday.

Net profit for India’s largest port operator increased by 67.8% from last year to ₹2,208.4 crore.

Revenue for the quarter also went up by 44.6% to ₹6,920.1 crore from ₹4,786.1 crore during the same period last year.

EBITDA or Earnings Before Interest, Tax, Depreciation and Amortisation also increased by nearly 60% from last year to ₹4,292 crore, from ₹2,698 crore.

EBITDA margin expanded by 600 basis points to 62% from 56% last year.

Adani Ports’ cargo volumes had risen 42% in December 2023 with portfolio ports delivering 300 MMT Cargo milestone in 266 days.

For the first nine months of financial year 2024, Adani Ports handled 311 MMT of cargo, which grew by 23% year-on-year.

Quarterly cargo volumes for the October-December period was also the highest ever at 108.6 MMT. Rail volumes for the quarter increased by 17% from last year to 1.57 lakh TEUs.

“Adani Ports recorded its strongest ever Q3 and nine-month performance with the highest ever revenue, EBITDA and cargo volumes and is on course to overachieve its full-year guidance provided at the start of the year,” said Ashwani Gupta, the CEO of Adani Ports.

Earlier this year, Adani Ports had increased its full-year cargo volume guidance to 400 MMT from the earlier guidance of 370 – 390 MMT provided at the start of the financial year.

Shares of Adani Ports reversed losses and are trading 1.5% higher at ₹1,225.95 post the results announcement.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Adani Group stocks volatile after Supreme Court directs SEBI to complete probe in three months

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Adani Group stocks are witnessing volatile moves after the Supreme Court directed market regulator SEBI to complete the probe in the remaining two matters within the next three months.

Shares of Adani Enterprises are off 5% from the highest point of the day, while Adani Ports has also seen some profit booking at higher levels. The stock is off 4.4% from the day’s high.

Besides the Nifty names, Adani Energy Solutions and Adani Total Gas have declined by 6% and 3% from their respective day’s high.

India’s Apex Court in its judgment said that there is no case made out for a transfer of the case from SEBI to CBI.

Post the verdict, Gautam Adani also wrote on “X” that the truth has prevailed.

The Hon’ble Supreme Court’s judgement shows that:

Truth has prevailed.
Satyameva Jayate.

I am grateful to those who stood by us.

Our humble contribution to India’s growth story will continue.

Jai Hind.

— Gautam Adani (@gautam_adani) January 3, 2024

The bench, led by Chief Justice Chandrachud along with Justices JB Pardiwala and Manoj Misra, had earlier reserved judgment on November 24.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Adani Ports Share Price: Uncertainty over Letter of Award for development of West Bengal’s Tajpur port

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Shares of Adani Ports & Special Economic Zone Ltd. are trading lower by a percent on Wednesday, November 22. Uncertainty has emerged over the Letter of Award that was granted to the company for the development of the Tajpur Port in West Bengal.

The West Bengal Government had cleared the Letter of Award to Adani Ports in October 2022.

In an exchange filing on October 12, 2022, Adani Ports had said: “The company has received a Letter of Award from West Bengal Industrial Development Corporation Ltd, Kolkata for development of a deep-sea port at Tajpur, West Bengal on Design, Build, Finance, Operate and Transfer basis.”

Karan Adani, CEO of Adani Ports had received the letter. “We’re poised to build not just a port but a complete infrastructural ecosystem which will become a maritime gateway for the entire Eastern India,” he had tweeted after receiving the letter.

However, West Bengal Chief Minister Mamata Banerjee, at the Bengal Business Summit on November 21 said that interested parties could bid for the Tajpur Port.

“There is a proposed deep sea port at Tajpur. That is ready. You can participate in the tender. It will attract an investment of about ₹25,000 crore,” she said.

CNBC-TV18 has reached out to Adani Ports over the issue and is awaiting a comment from the company.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Adani Ports shares gain as analysts raise target post decent Q2 results. Should you buy this stock?

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Shares of Adani Ports and Special Economic Zone Limited gained 1.5% in Friday’s opening trade as a couple of top brokerages recommended ‘Buy’ rating on the counter and some even raised their price targets after APSEZ reported a decent second-quarter with stable operational numbers.

At 10:08 am, the scrip was trading 0.83% higher at ₹812.90 apiece on the NSE. The Adani Ports stock has rallied 18% in the last six months.

Global brokerage firm Jefferies has maintained its ‘Buy’ rating on Adani Ports with an increased share price target of ₹985. CLSA finds the stock worth ₹878.

Jefferies has raised its FY24 to FY26 volume by 4% based on recently announced October 2023 volume run-rate. Additionally, it said the management is now confident of meeting the upper end of its FY24 9-15% year-on-year (YoY) volume growth guidance.

According to CLSA, Adani Ports’ mergers and acquisitions (M&A) strategy has paid a rich dividend. The CEO is resolutely focused on its next leg of growth, saying, “Will bring down net debt-to-EBITDA to 2.5 times in FY24.” The port operator’s net debt-to-EBITDA improved to 2.8 times from 3.1 times in March 2023.

Adani Ports posted a revenue growth of 28% in the September quarter, beating analysts’ estimates, even as profit was hurt by a MAT (Minimum Alternate Tax) credit write-off.

During the quarter, the port operator recorded a 17% year-on-year (YoY) growth in cargo volumes to reach 101.2 million metric tonnes (MMT) .

Adani Ports handled a total cargo volume of 37 MMT in October 2023, marking a strong 48% growth on a YoY basis.

APSEZ handled combined volumes of 240 MMT cargo in the seven months of the ongoing financial year 2024, while the recorded volume grew by approximately 15% on a YoY basis across the ports in India.

Both Mundra and non-Mundra port clocked strong growth across dry, liquid and container volumes. Overall volumes rose 28% YoY and 6% QoQ.

“With the completion of the Karaikal acquisition, the port is ramping up well, along with the newly acquired Haifa port, which managed 6.6 MMT in 1HFY24. The management continues to remain optimistic about achieving its higher end of FY24 cargo guidance,” said Motilal Oswal Securities while suggesting a target of ₹1,050 on the stock.

With operational ramp up at ports acquired in the last few years, Motilal expects APSEZ to register a 13% volume growth over FY23 to FY25. This would drive a compounded revenue, EBITDA, PAT of 20%, 17%, and 12%, respectively, over the same period.

Operating profit, calculated as EBITDA, shot up 27% on-year but dipped 3% QoQ as margin came in at 58.4% in the September quarter. The margins were adversely impacted by higher operating expenses.

The first half of this financial year 2023-24 has been strong for Adani Ports, and with this run-rate, analysts at Nuvama Institutional Equities believe that FY24’s operational metrics could overshoot management guidance.

Logistic footprint

The logistics business, Nuvama said, is sustaining rapid growth and has synergies with the port business.

“More importantly, the logistics business continues to outpace peers with a total of 10 MMLPs and two more to come during the year. With robust growth and prudent spending on capex, we expect the returns ratios and debt metrics to improve over the next couple of years,” it said.

On the logistics side, Nuvama said that Adani Ports aspires to achieve warehousing capacity of 60 million square feet with an annual addition of 10 million square feet. “Inorganic acquisition on the port side along with multi-fold capacity creation in the logistic business should unleash multi-year growth prospects for APSEZ,” the brokerage noted.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Adani Ports shares rise as US’ DFC to invest $553 mn in Adani Group’s Sri Lanka port

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Shares of Adani Ports and Special Economic Zone Limited, part of billionaire Gautam Adani’s conglomerate, gained over 2% on Wednesday after the US International Development Finance Corporation (DFC) announced that it will fund a project partly owned by the Adani Group.

US International DFC will invest $553 million in the Colombo port terminal project — a consortium of India’s largest port operator Adani Ports and SEZ Ltd, Sri Lanka’s leading enterprise John Keells Holdings (JKH) and the Sri Lanka Ports Authority.

“DFC, the US government’s development finance institution, partners with the private sector to finance solutions to the most critical challenges facing the developing world. It invests across sectors, including energy, healthcare, infrastructure, agriculture and small business and financial services,” Adani Ports said in a statement.

“This is the first time that the US government, through one of its agencies, is funding an Adani project, which is as a ringing endorsement of the Adani Group. It shows their confidence in the Group’s ability to invest and to create a world class container facility in Colombo Port,” it stated.

The investment assumes significance especially after US short-seller Hindenburg Research accused Adani of accounting fraud and artificially boosted its share prices, calling it a “brazen stock manipulation and accounting fraud scheme” and “the largest con in corporate history”.

The Adani Group, however, has firmly denied these allegations.

Hindenburg’s report wiped out billions of dollars from the conglomerate’s market value at one point.

“We welcome the association of the US International Development Finance Corporation (DFC), the US government’s development finance institution, in funding the Adani project – and we see this as a reaffirmation by the international community of our vision, our capabilities and our governance,” said Karan Adani, Whole Time Director and CEO, Adani Ports.

When completed, Colombo West International Terminal project will transform the socio-economic landscape, not just in Colombo but across the island, through thousands of direct and indirect new employment opportunities and by massively boosting Sri Lanka’s trade and commerce ecosystem, he said.

The Port of Colombo is the largest and busiest transshipment port in the Indian Ocean. It has been operating at more than 90% utilisation since 2021, signalling its need for additional capacity. The new terminal will cater to growing economies in the Bay of Bengal, taking advantage of Sri Lanka’s prime position on major shipping routes and its proximity to these expanding markets.

At 10:56 am, the Adani Ports scrip was trading 2.13% higher at Rs 814.55 apiece on the NSE. The stock has rallied nearly 20% in the last six months.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

All Adani Group stocks end lower led by Ports, Power; Rs 34,000 crore market cap lost

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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All Adani Group stocks ended lower on Monday led by Adani Ports Ltd. and Adani Power Ltd., both of which fell between 5% to 6%.

Overall, the group lost Rs 34,000 crore in market capitalisation. Adani Power lost over Rs 9,000 crore in market capitalisation, while Adani Ports lost Rs 8,600 crore in overall market capitalisation.

Adani Ports ended as the top loser on the Nifty 50 index due to the impact of the Israel-Palestine war. The company is the owner and operator of the Haifa port in Israel.

In a clarification to the exchanges this afternoon, Adani Ports said that it is closely monitoring the situation on ground in South Israel. The Haifa port is situated in North of Israel and contributes 3% to the company’s total cargo volume.

For the first half of financial year 2024, Adani Ports reported total cargo volumes of 203 MT, of which 6 MT came from the Haifa port.

The Port of Haifa is the second largest port in Israel in terms of shipping containers and the biggest in shipping tourist cruise ships.

Here’s a look at how the Adani Group stocks ended on Monday:

At the end of the day, the Adani Group ended with a combined market capitalisation of Rs 10.5 lakh crore.

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Adani Ports shares plunge 4% as Israel goes to war with Hamas

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The fallout from Saturday’s surprise attack on Israel by the Palestinian group Hamas reverberated through markets, sending the Adani Ports and Special Economic Zone stock sliding 4 percent. Adani Ports had acquired Israel’s Haifa port for $1.2 billion in July, 2022.

The Port of Haifa is the second largest port in Israel in terms of shipping containers and the biggest in shipping tourist cruise ships.

“We are closely monitoring the action on ground which is concentrated in South Israel, whereas Haifa port is situated in the North. We remain fully alert and prepared with a business continuity plan that will enable us to respond effectively to any eventuality,” said Adani Ports spokesperson.

Adani Ports in partnership with local chemicals and logistics group Gadot in July last year won an Israel government’s tender to buy the Haifa Port, a major trade hub on Israel’s Mediterranean coast.

The ports-to-power conglomerate has vowed to transform the skyline of this Mediterranean city as part of its decision to invest more in the Jewish nation, including opening an artificial intelligence lab in Tel Aviv.

Adani’s company has no holdings in the West, so its entry into Israel is a signal for increased maritime traffic between Asia and Europe, and the major Asian players’ need for a hub in the Mediterranean.

“The acquisition of the Haifa port also comes with a significant amount of real estate. And I promise you that in the years to come we will transform the skyline we see around us,” said Adani, the founder and chairman of the group.

“The Haifa of tomorrow will look very different from the Haifa that you see today. With your support – we will deliver on this commitment and do our part to transform this city,” he had said.

The overall contribution of Haifa in APSEZ’s numbers stood at 3 percent of the total cargo volume. “For the current fiscal, we have guided for Haifa Cargo volumes range of 10-12 MMT and APSEZ’s total cargo volume guidance of 370-390 MMT,” the group said.

In the initial six months of April-September 2023, APSEZ’s total cargo volume was 203 MMT, of which the Haifa share is 6 MMT.

Adani Ports stock performance

Having plunged to as low as Rs 462.45 in February after Hindenburg’s allegations, the stock has recovered 73 percent. At 11:05 am on Monday (October 9), the scrip was trading 3.64 percent lower at Rs 800.50 apiece.

The Hindenburg Research report, published late January, alleged accounting fraud, stock price manipulation and improper use of tax havens by the Adani group companies, triggering a $150 billion rout in the group market capitalisation earlier in 2023.

The group maintained that the report by the US-based short seller was a “deliberate and malicious attempt” aimed at damaging the reputation of the group and generating short-term profit by driving down Adani group stocks.

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Adani Ports shares rise on bid to buy back up to $195 million of 2024 bond

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Shares of Adani Ports and Special Economic Zone (SEZ) rose 1.33 percent to hit a day’s high of Rs 833 apiece on the NSE in Wednesday’s trade after the company commenced cash tender offer for up to $195 million to partly prepay its near-term debt maturities.

Adani Ports had started a buyback programme of some debt securities in April to prepay part of its near-term loans due in 2024.

The private port operator has started a tender offer to buy the outstanding 3.375 percent senior notes due in 2024 for up to $195 million in cash, billionaire Gautam Adani-led company said in a regulatory filing.

Bond buybacks allow companies to repurchase debt through tender offers to bondholders, enabling them to retire some or all of the securities ahead of their due date.

The purpose of the tender offer is to partly prepay the company’s near-term debt maturities. Following the successful completion of this tender offer, the company expects $325 million notes to remain outstanding, it said.

This is the Adani Ports’ second tranche of the bond-purchase programme after it settled notes worth $130 million in May this year.

The company has said it plans to keep buying the outstanding notes over the next three quarters for cash. The ports and logistics company intends to fund the buyback from its cash reserves.

The tender offer will expire at 5 pm, New York time, on October 26, 2023, unless extended or earlier terminated, the company said.

The company has engaged Barclays Bank, DBS Bank, Emirates NBD Bank, First Abu Dhabi Bank, Mizuho Securities (Singapore), MUFG Securities Asia Singapore Branch, SMBC Nikko Securities (Hong Kong) Limited, and Standard Chartered Bank to serve as dealer managers for the tender offer.

The announcement takes place just as the ports-to-power conglomerate seeks to refinance a $3.5 billion worth of debt taken out for an acquisition,   having suffered a blow earlier this year. A report by US-based short seller Hindenburg Research had accused the group of improper use of offshore tax havens and stock manipulation. The conglomerate backed by Adani denied all allegations.

The Adani-led group’s seven-listed stocks have lost over $100 billion in market value since the explosive report.

Having plunged as low as 85.8 cents on the dollar in February after Hindenburg’s allegations, the 2024 notes have recovered and were trading at 96.5 cents on the dollar on Wednesday, according to a Bloomberg report.

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3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow