Container Corporation of India Ltd. share price forecast

Container Corporation of India’s (CONCOR) Q1FY24 EBITDA missed our and consensus estimates by 12.7% and 15.6% respectively. Key points: 1) EBITDA margin contracted to 20.4% and EBITDA/teu was down to INR 3,580 (lowest since Q1FY22) on escalation of provision for land license fee (LLF) and lower realisation; 2) originating volumes declined 5.4% YoY to ~571kteu due to subdued demand, weather-related disruptions in north and west of India.

Container Corporation of India’s (CONCOR) Q4FY23 performance missed consensus estimates. Key points: 1) EBITDA margin declined further sequentially to 20.5% in Q4FY23 (vs 21.4% in Q3FY23); 2) EBITDA/teu rose slightly owing to better profitability of the domestic segment

Container Corporation of India’s (Concor) performance missed consensus estimates. Key points: 1) EBITDA/teu declined due to higher proportion of domestic business; 2) EBITDA margin was down 390bps QoQ to 21.4%; 3) rail freight expenses were higher due to removal of certain discounts by Indian Railways.

Container Corporation of India’s (Concor) Q2FY23 performance missed
consensus estimates. Key takeaways: 1) EBITDA/teu declined due to higher
proportion of domestic business.

The recent cabinet approval to reduce the land licence fees for railway land from 6% to 1.5% of the land cost will help increase the private sector's involvement in the Gati Shakti programme.

Container Corporation of India (Concor) maintained its Q1FY23 volume guidance despite a weak EXIM print. Origination was 64% of EXIM and 47% of domestic volumes (stable).

Key triggers for future price performance: Concor expects to double its domestic volumes in medium term (via higher movement of bulk commodities). Also, higher double stacking with mixed trains along with assured transit times will...

Container Corporation (CCRI) reported strong 2QFY22 earnings with EBITDA at INR4.3b beating our estimate by 6%, led by better-than-expected realization and operational efficiency. The Dedicated Freight Corridor (DFC) will benefit CCRI significantly through a) double stacking, b) higher load capacities, and c) reduced turnaround time, thus leading to improved volumes and profitability....

LIC Housing Finance: LICHF disappointed, driven by elevated provisioning (1.1% of loans, annualised) and interest reversals (INR1.35bn). While asset quality improved across buckets, aggregate stressed pool (GS-II + GS-III + restructured) still remains elevated (12.6% vs. 13.6% in Jun'21), indicating that the path to normalisation is likely to be prolonged. The company shored up its GS-III provisions significantly to 43%, driving credit costs higher, although GS-II provisioning coverage continues to be subdued (0.2% PCR). Disbursements gathered momentum post the second wave (+29% YoY, +86% QoQ), largely from the core mortgage segment. We downgrade our FY22E earnings by 7% to reflect sub-optimal yields and higher-than-expected credit costs. We maintain REDUCE with a revised TP of INR401 (earlier TP of INR421), 1.0x Sep'23 ABVPS, underpinned by low provisioning buffer, prolonged stress in the portfolio, and increasing competitive intensity in the core mortgage portfolio. Federal Bank: Federal Bank (FB)'s Q2FY22 earnings were 20% higher than our forecasts due to a strong operating performance and lower-than-expected provisions. On the back of a granular wholesale portfolio and its secured retail franchise, FB reported an impressive asset quality with slippages at 1.1% and steady early-stage delinquencies (restructured book inched up to 2.6% of loans). The bank continued to showcase strong traction in low-cost deposits (CASA at 36%) and core fee income. FB's partnerships with FinTechs (with neo-banks, payments firms, and merchant acquirers) offer medium-term catalysts for higher productivity (business growth) and greater efficiencies (profitability), early evidence of which is reflected in the pace of new account additions. We revise our FY22E earnings...

What should investors do? Concor and CTOs in general are seeing their transit times declining between TKD/Dadri to Gujarat ports. Further, normalisation of DFC and | 1000/TeU pan-India price hike from October 1 are expected to further...

Work on long term lease contract with Indian Railways is in advance stage; management maintains its revenues growth guidance of ~12% YoY in FY22. CCRI reported strong 1Q numbers on the back of robust volume growth and uptick in realizations, both in EXIM and domestic segments. Improvement in...