Adani Ports Shares Fall Despite Q2 Beat
Shares of Adani Ports and Special Economic Zone Ltd. declined even as its second-quarter beat estimates, aided by a strong volume growth.
Net profit of India's largest private port operator rose 65% year-on-year to Rs 1,738 crore in the quarter ended September, according to its exchange filing. That compares with the Rs 1,311-crore consensus estimate of analysts tracked by Bloomberg. The company's cargo volume rose 15% year-on-year to 86.6 million metric tonnes in the quarter.
The depreciating rupee dragged the profits of the Adani Group company. The foreign exchange loss in the quarter stood at 369.7 crore, as against a gain of Rs 53.21 crore in the comparable period.
Adani Ports Q2 FY23 Highlights (YoY)
Revenue rose 33% to Rs 5,211 crore, against the estimated Rs 4670.6 crore
Ebitda rose 31% to Rs 3,260 crore, excluding forex MTM loss/gain. It compares with the Rs 2,699.3-crore forecast.
Kotak Institutional Equities sees a healthy 13% YoY growth in Adani Ports and SEZ. The volumes and sustained uptick in realisation helped the company grow its port Ebitda by 25% YoY, it said.
Shares of Adani Ports fell 1.28% to Rs 831 apiece as of 10:04 a.m., while the benchmark Nifty 50 declined 0.15% on the NSE. Total traded volume is 3.3 times the 30-day average, according to Bloomberg data.
Of the 24 analysts tracking the company, 22 maintain a 'buy' and two suggest a 'hold'. The 12-month consensus price target implies an upside of 12.4%.
Here's what brokerages made of quarterly results
Nomura
Maintains 'Buy' with a target price of Rs 1,025, implying a potential upside of 21.7%.
Nomura says strong results with guidance retained and potential upside from improving logistics.
Management has retained volume guidance for FY23 despite global trade headwinds.
Improving ROCE in logistics segment and potential land sale in SEZ can emerge as catalysts.
Axis Capital
Maintains 'Add' with a target price of Rs 948, implying a potential upside of 13%.
Axis Capital says strong per ton realisation in port business and low tax rate drive earning beat.
Consolidated port and logistics income both grew at 30% YoY in Q2.
BofA Securities
Reiterate 'Buy' rating with price objective of Rs 943, implying a upside potential of 12.12%
Cargo volumes saw strong growth of 15% YoY. Port revenue grew by 33% YoY.
BofA says logistics business is expected to continue it growth on the back of improved ultization of assest.
Disclaimer: Adani Enterprises is in the process of acquiring a 49% stake in Quintillion Business Media Ltd., the owner of BQ Prime.
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