Container Corporation of India Ltd. share price target

Container Corp's (CCRI) Q2FY21 print was in line with our estimates.

Q2 was an operationally good quarter for Concor with revenues in line and EBIDTA and PAT better than estimates (Refer Exhibit 1). Q2 revenues were at Rs15Bn down 13% YoY / up 26% QoQ led -10%/-2% volume/realization decline. EXIM/Domestic Revenue mix stood at 90:10% vs 94:6% YoY/ 84:16% QoQ. EBITDA margin came at 20.8%, sequentially better than that reported in Q1. The company has also...

Management reiterates its stand on LLF payable at ~Rs4.5bn for FY21 vs. Rs12.8bn demanded by Indian railways. CCRI reported decent 2Q numbers with strong volume recovery in both EXIM and Domestic segments. On the back of sharp exports surge, Sep'20 saw a...

Concor reported strong results that were better than I-direct estimates on all fronts. On volumes front, Exim segment grew 19% QoQ (still down 10% YoY) while domestic volumes grew 35% QoQ (led to flat YoY). Hence, Exim revenues grew 26% QoQ to | 1130 crore while domestic revenues grew 29% to | 373 crore. Standalone EBITDA margins expanded 745 bps QoQ to 20.8% due to better cost control measure by the company and absolute EBITDA doubled. For the quarter, the company recorded | 113 crore as land...

Most high frequency indicators posted a strong YoY recovery in Sep'20.

CCRI: Annual report analysis FY20 a mixed bag. BESTAGRO: Up-and-coming agrochem player

Container Corp's (CCRI) FY20 annual report reveals a mixed year with some hits and some misses.

The ARA talks about the strategies and opportunities foreseen in medium to long term, future capex and expansion of geographical reach to neighboring countries. It is also eyeing new segments like warehousing, ecommerce, 3PL/ 4PL, distribution logistics, coastal shipping. Commencement of DFC will bring cost advantage, improved turnaround time along with rise in volumes and utilization through more double stack trains. However, the last one year has been tough with SEIS income provisioning, shocker on land license fees, and a 20% volume de-growth...

This was weighed by the COVID-19 impact on volumes (-21% YoY) and structural increase in fixed cost due to a >5x increase in land license fee (LLF) charged by the Railways for the use of its land. Revenue declined to INR11.9b (-27% YoY / -24% QoQ), v/s our estimate of INR12.1b, on weaker volumes and realization. EXIM volumes stood at 627,905 TEUs (-20% YoY / -19% QoQ) and domestic volumes were at 104,806 TEUs (-25% YoY / -37% QoQ). EXIM realization was weak at INR14,344/TEU (-11% YoY / -2% QoQ), while domestic realization stood at INR27,524/TEU (+5% YoY / +4% QoQ). Total expenditure, however, declined marginally to INR10.3b (-17% YoY, -6% QoQ) on higher LLF effective from 1QFY21. However, from 1QFY21, MoR changed the LLF charged to 6% of the value of the land and raised demand for INR7.76b for FY21 (>5x of INR1.

From April 1, the Railway Ministry revised the annual land licensing fee (LLF) norms for Concor (Indian Railway land on which ~25 Concor of total 64 terminals operate). The change should be seen in the backdrop of Concor's privatisation, as earlier mode of LLF payment provided certain advantage to the company vs. other private CTOs. Earlier method of payment was based on Concor's volumes and was, thus, variable in nature (| 1175/TeU). However, the revised mode of payment is fixed in nature (6% of value of land). This has caused LLF payment to jump from earlier | 120 crore paid in...