More Stories

Informist, Friday, Jan. 24, 2025

By Sunil Raghu

AHMEDABAD – India's economy may be battling rough seas and inclement weather. However, India's biggest private sector ports player Adani Ports and Special Economic Zone Ltd is again likely to traverse through not so choppy waters, courtesy its diversification in geography as well as in the cargo it handles at its ports.

The private sector port major's consolidated net profit for Oct-Dec is expected to jump 17.4% on year to INR 25.9 billion, according to an estimate of four brokerages. Though sequentially, the net profit is expected to rise about one-third of that, by 6%. Revenue of the company during the quarter is seen rising 5.9% on year and 3.7% on quarter to INR 73.3 billion, as per the research reports by four brokerages.

Adani Ports is the largest private port player in the country and has a portfolio of 14 ports, representing more than one-fourth of the country's total ports volume. Operationally, in Oct-Dec, Adani Ports handled 112.3 million tonnes of cargo, up 3.4% on year from 108.65 million tonnes in the year-ago period. In Jul-Sept, the company's ports clocked a volume of 110.9 million tonnes.

The freight traffic handled by 12 major ports in India in Apr-Dec rose 2.7% on year to 621.8 million tonnes, data released by the Indian Ports Association showed. On other hand, Adani Ports' multiple ports and terminals across the nation handled a total of 332.4 million tonnes of cargo in Apr-Dec, a rise of 7% on year. This growth in cargo was primarily driven by containers, which rose 19% on year and liquids and gas, which rose 8% on year. Within the logistics segment, Apr-Dec rail volumes were at 480,000 twenty feet equivalent units, up 9% on year and general purpose wagon investment scheme volumes at 16.1 million tonnes, up 13% on year.

Among the brokerages polled, Kotak Institutional Equities estimated the lowest net profit for Adani Ports in Oct-Dec at INR 25.7 billion, while Motilal Oswal Financial Services Ltd estimates the highest net profit at INR 26.3 billion. As for Adani Ports revenues in Oct-Dec, Elara Securities (India) Pvt Ltd has the lowest estimate of INR 71.8 billion, while Motilal Oswal again has the highest estimate at INR 75 billion.

Adani Ports would announce its December quarter earnings on Jan. 30.

Among the analysts polled, Elara Securities (India) Pvt. Ltd. states that volumes for major ports in October and November declined 4%, led by a drop in coal imports, on a higher domestic production and slack demand from the biggest coal user – the electricity sector. Exports of iron ore, too, were low as demand from China and global prices had both slumped. This is likely to slow down volume handled by Adani Ports. The company has already reported volume growth at 3.6% on year aganist 8.5% in Apr-Sept. In Oct-Dec, revenue contribution from Gopalpur Ports and Astro Offshore business may commence. On a consolidated basis, Elara expects Adani Ports' revenues to grow 4% on year, with EBITDA margin at 61.5% and net profit at INR 23 billion, post likely forex loss of INR 2.5 billion, given adverse forex movement.

Kotak Institutional Equities has modelled a weak 4% on-year improvement in the volumes and revenues for Adani Ports, impacted by the lack of scale-up in Gangavaram port, weakness in imported coal volumes and weak macro growth. It also models EBITDA margins for the December quarter at 61%, similar to Jul-Sept. Kotak Institutional Equities has also recommended a 'buy' on the stock, with fair value at INR 1,570 per share.

Friday, shares of the company closed 0.9% lower at INR 1,094.15 on the National Stock Exchange. At the current price, the stock is down about 20% from the day the company announced its September quarter earnings on Oct. 29. On the day of its September quarter earnings, the stock closed 0.9% higher at INR 1,377. Next day, it opened at INR 1,379.95 and ended the day 1% higher at INR 1,393.50, before hitting a high of INR 1,414.90 and a low of INR 1,358.05.

Motilal Oswal Financial Services Ltd in its report expects revenue for Adani Ports to jump 8% on year to INR 74.9 billion, driven by 3% growth in port volumes and 12% growth in the logistics business. It expects EBITDA at INR 43.9 billion, with EBITDA margins to contract 190 basis points on year due to muted volume growth. Improvement in utilisation at the existing and recently acquired ports and growth in the logistics business remain the key monitorables for Motilal Oswal.

The average of the earnings before interest, taxation, depreciation and amortisation as estimated by four brokerages was INR 44.5 billion, with a range of INR 43.9 billion to INR 46.1 billion.

In Oct-Dec, the company's consolidated net profit was at INR 22.1 billion on a revenue of INR 69.2 billion.

Following are the Oct-Dec earnings estimates for Adani Ports Ltd based on reports from four brokerage firms in descending order of the estimate of net profit (in INR million):

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Edited by Akul Nishant Akhoury

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.

Informist Media Tel +91 (22) 6985-4000

Send comments to feedback@informistmedia.com

© Informist Media Pvt. Ltd. 2025. All rights reserved.