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Moitlal Oswal Report
Adani Ports & Special Economic Zone Ltd. remained under brokerage radar after Motilal Oswal reiterated its 'Buy' rating on the stock and maintained a target price of Rs 2,130, indicating an upside potential of around 24% from the current market price of Rs 1,720.
The bullish stance comes after the port operator reported a strong and steady performance in the first quarter of FY27. Revenue rose 19% YoY to Rs 10,800 crore, broadly in line with estimates, while Ebitda grew 19% to Rs 6,500 crore, surpassing the brokerage's expectations. Adjusted profit after tax increased nearly 10% YoY to Rs 3,700 crore.
Cargo volumes during the quarter climbed 15% YoY to 138.1 million metric tonnes (MMT), driven largely by robust growth in international operations. The company's Ebitda margin expanded to 60.4%, supported by a favorable cargo mix, improved operating efficiencies and a higher contribution from value-added services.
Motilal Oswal highlighted that Adani Ports international ports business was the key growth driver in the quarter, while domestic cargo volumes remained subdued due to temporary disruptions at certain ports, the company reported an expansion in Ebitda margins, aided by a favorable cargo mix, improved operating efficiencies, a higher contribution from value-added ancillary services and a strong Ebitda contribution from international ports.
The brokerage believes that the company remains well-positioned to outpace broader industry growth, supported by ongoing capacity additions and expansion into valueadded segments such as logistics.
Motilal Oswal broadly retains its FY27 and FY28 estimates and expect Adani Ports to post 11% growth in cargo volumes over FY26- 28. This would drive a CAGR of 17%/18%/21% in revenue/Ebitda/PAT over FY26-28E.
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