Gujarat Pipavav Port Ltd. share price target

Bulk expected to normalise in medium term promoter (APM Terminals Maersk Group). It lies at a strategic international maritime location, which connects India with the Far East, on the one side, and...

Decadal growth opportunity with significant margin of safety

Subsequently, PAT de-grew 50% QoQ (down 32% YoY) to | 33 crore What should investors do? We expect commissioning of DFC (near term), the normalisation of global container trade (in the medium term) and extension of...

Q3 saw 14% YoY de-growth in overall volumes. However, the base quarter had higher volumes of transhipment (low margin business), which got reversed this quarter. Exim volumes, on the other hand, have nearly normalised and coastal volumes grew YoY. Continued congestion at Colombo hubs, led to higher container volumes at India's bigger ports such as Mundra. GPPL, on the other hand, reported lower volume growth mainly due to management focus on picking up profitable volumes (transhipment volumes negatively impact margins). The management expects the global...

Q3 saw 14% YoY de-growth in overall volumes. However, the base quarter had higher volumes of transhipment (low margin business), which got reversed this quarter. Exim volumes, on the other hand, have nearly normalised and coastal volumes grew YoY. Continued congestion at Colombo hubs, led to higher container volumes at India's bigger ports such as Mundra. GPPL, on the other hand, reported lower volume growth mainly due to management focus on picking up profitable volumes (transhipment volumes negatively impact margins). The management expects the global...

In Q2, while July, August posted good uptake of container volumes, the company experienced a tough September due to disruption in the domestic trade patterns (more exports), shortages of empty containers and skipped calls (19 in Q2), thereby leading to a 50-60% hike in ocean freight along some routes. However, the management saw volumes returning in October, November (no skipped calls seen so far). Going ahead, GPPL expects the situation (surcharges by shippers) to largely normalise. The bulk segment continued to witness growth (up 36%) while the liquid, RoRo segment...

The 30-year concession agreement between GPPL, Gujarat Maritime Board (GMB) and Gujarat government ends in CY28. Upon expiry of the agreement, all assets have to be handed over to GMB based on valuation provided by an independent third party. The company, however, has received approval from its global parent to incur US$97 million on upgrading its container facility and increasing its yard capacity to 1.6 million TeU (current capacity 1.35 mil TeU). GPPL will require written permission from GMB authorities for extension of the concession agreement before incurring the capex. The...

As per internal estimates of APM terminals, global Exim trade is expected to de-grow 20% in FY21E. However, the management expects volumes at GPPL to be minimally disrupted during the same year. Port imports (60-65% of cargo) are Far-East oriented, which is showing positive signs of recovery while the ports on the west (US, Europe) continue to lag behind. On the exports front, the management is seeing positive trends and expects good agricultural exports to the Middle East in Q2FY21. In FY20, 45% of GPPL volumes were transported via its parent entity APM-Maersk. In April, May,...

Gujarat Pipavav Port (GPPL) reported an improved operating performance for Q3FY20 with revenues increasing 13% YoY to | 197 crore. EBITDA margin improved 300 bps YoY to 59.5% due to decline of 100 bps, 220 bps in employee and other expenses as percentage of sales, respectively. Improved operating performance led PBT to post growth of 19% YoY to | 107 crore but tax write-back to the tune of | 60 crore on account of deferred tax adjustment led net profit to increase 120% YoY to | 134.01 crore. Bulk, liquid volumes spurt; container volumes muted...

Gujarat Pipavav Port's (GPPL) container volumes grew 13% YoY. Bulk and RoRo volumes de-grew 18%, and 6% mainly due to lower growth in the fertiliser volumes and weak consumer demand, respectively, while liquid volumes grew 25%. This led overall revenue to remain flat YoY. Subsequently, EBITDA margins increased 576 bps mainly due to Ind-AS 116 adjustment of | 5.1 crore in the operating expense element. However, PAT grew 20% YoY mainly due to higher other income (includes dividend from subsidiary PRCL). The management expects the macro situation to remain...

Trans-shipment led to strong growth in FY19 container volume In FY19, container volumes grew 28% to 903 (000) TEU, led by strong transshipment volumes (that command lower realisation). Bulk volumes grew 10% to 2 MMT, led by a resurgence in fertiliser volumes, while liquid and Ro-Ro volumes declined 38% and 23%to 0.64 MMT and 76000 cars, respectively. The management expects container and liquid volumes to remain strong in FY20. However, they expect volatility to continue in the bulk segment and slower growth in Ro-Ro segment. We expect 15% container...

ICICI Securities Ltd | Retail Equity Research Revenues grew 7% YoY to | 175 crore (I-direct estimate: | 168 crore). Container volumes grew 45% YoY to 251000 TEUs (I-direct estimate: 224900 TEUs). Growth is expected to have been largely derived from the higher transshipment volumes. Bulk volumes de-grew 40% YoY to 0.33 MT (vs. 0.53 MT in Q2FY19). Liquid volumes fell 54% YoY to 0.15 MT (vs. 0.09 MT in Q2FY19). Volumes from Ro-Ro activity de-grew 33% YoY to 20000 cars (vs. 22000 cars in Q2FY19)...

ICICI Securities Ltd | Retail Equity Research Revenues grew 13% YoY to | 171 crore (I-direct estimate: | 163 crore). Container volumes grew 49% YoY to 238000 TEUs (I-direct estimate: 179200 TEUs). Growth was mainly due to higher transhipment volumes. Bulk volumes grew 3% YoY to 0.53 MT (vs. 0.62 MT in Q1FY19). Liquid volumes declined 67% YoY to 0.09 MT (vs. 0.16 MT in...

ICICI Securities Ltd | Retail Equity Research Revenues grew 4% YoY to | 176 crore (I-direct estimate: | 168 crore). Container volumes grew 18% YoY to 195000 TEUs (I-direct estimate: 189800 TEUs). Growth was mainly on the back of addition of a new liner in Q4FY18. Bulk volumes grew 23% YoY to 0.62 MT vs. 0.27 MT in Q4FY18. Liquid volumes fell 25% YoY to 0.16 MT vs. 0.21 MT in...

ICICI Securities Ltd | Retail Equity Research Revenues de-grew 5.2% YoY to | 165.5 crore (I-direct estimate: | 171 crore). Container volumes grew 30% YoY to 205000 TEUs (I-direct estimate: 187400 TEUs). Growth was mainly on the back of new services & ad hoc calls. Bulk volumes de-grew 19% YoY to 0.27 MT vs. 0.33 MT in Q4FY17. Liquid volumes declined 16% YoY to 0.21 MMT vs. 0.25 MMT in Q4FY17. Volumes from Ro-Ro activity declined 4% YoY to 23000 cars vs. 24000 cars in Q4FY17...

ICICI Securities Ltd | Retail Equity Research Revenues de-grew by 4% YoY (up 7% QoQ) to | 162.7 crore (I-direct estimate: | 168.8 crore). Container volumes grew 4% YoY (8% QoQ) a to 173000 TEU's (higher than our estimate of 170000 TEU's). Bulk volumes grew by 10% YoY (up 8% QoQ) to 0.55 MT as compared to 0.5 MT in Q3FY17 and 0.51 MT in Q2FY18. Liquid volumes rose by 39% YoY (up 14% QoQ) to 320000 MT vs. 230000 MT in Q3FY17 (280000 MT in Q2FY18). Volumes from Ro-Ro activity rose by 11%...

After directing ME-1 from Mundra Port (now a shared service call between Mundra and Pipavav Port), Maersk Line has shifted FI3 service to Pipavav. As per our channel checks, FI3 currently drives a volume of ~120,000 TEUs per annum at Mundra This shift can take Pipavav's monthly run-rate to ~65,000 TEUs in FY19E from ~55,000 TEUs in FY18E (assuming zero growth in base monthly volume of 54,000-55,000 TEUs). Given that Maersk is a large customer for Mundra, we do not rule out the possibility of...

Revenues de-grew 12% YoY (down 10% QoQ) to | 151.7 crore (Idirect estimate: | 165.7 crore). In addition to the subdued demand on the west coast, dollar strengthening, loss of two to three calls in the current quarter and a liner (INDFEX) in previous quarter continue to impact the overall realisations and volumes Container volumes de-grew for a fourth consecutive quarter by 4% YoY (down 3% QoQ) to 160000 TEUs (in line with our estimates). Bulk volumes de-grew 27% YoY (up 3% QoQ) to 0.52 MT vs. 0.71 MT in Q2FY17, 0.51 MT in Q1FY18. The number of trains fell from 665 trains...