( You can find my report on Adani Ports & SEZ Ltd written a couple of months ago, at this link )
Adani Ports & SEZ Ltd. (APSEZ) has posted another strong set of numbers for Q4-FY'15. It has posted a very healthy Y-o-Y growth of 42% in it's Total Income for the Quarter gone by. And this comes on the back of 32% posted in Q2 and 38% posted in Q3 for this fiscal. This is an excellent momentum of growth that the company has managed to build up in the recent quarters. Remember that APSEZ is amongst the largest Logistics companies in India, primarily involved in Port operations & associated SEZ. A strong growth in this company's business means that there has been significant growth in Import-Export activities in India, which in turn indicates that the economic activities in the country are on the up swing.
( Click here for Adani Ports' Easy Results Summary page. )
The charts alongside show the progress in Trailing-Twelve-Months numbers. The Total Income has now grown to a little over Rs.6800 crores, EBITDA is very close to Rs.4600 crores and Net Profit is over Rs.2300 crores. The FY'15 EPS stands at Rs.11.2/-. For FY'15 APSEZ has posted a growth of 24% in it's Total Income and a Net Profit growth of 33%. I am expecting APSEZ to continue growing at a rate of over 20% Y-o-Y for the next 2-3 years. Part of this growth will be Organic in nature, while some part will be because of Inorganic reasons. APSEZ has done some recent acquisitions and is looking to expand capacities at the newly acquired Ports. This is where the inorganic growth will come from.
It's been just 1 year of the Modi Govt and things are being put in place to ensure that the country's growth rate picks up to 8%+ levels. The Make-in-India push will start showing on the ground in the couple of years time. This could boost India's participation in Global trade, in turn resulting in increased volumes of Import-Export of goods. All this will benefit companies operating in the Ports Logistics business. APSEZ is clearly preparing itself to grab a good chunck of this increased volumes of goods being shipped into or out of India. I won't be surprised to see APSEZ doubling it's Total Income in 3 years time or tripling in 5 years time, from the current levels.
In the recent few weeks we have seen the Nifty index moving from levels closer to 9000 to levels closer to 8000 now. Many of the stocks, even of Bluechip companies, have corrected in the region of 10% to 25% during this time. But look at APSEZ's stock price chart above. This stock has remained more or less steady in the Rs.300 to 330 range, despite the massive correction happening with most other stocks. This shows the strength in APSEZ's stock price. I think there are good chances of APSEZ's stock getting re-rated to a higher P/E ratio in the next 6-12 months. Currently it trades at a P/E ratio of about 29-30. I think we could see this being increased to about 35 in the coming months. It may not happen immediately. The current correction in markets should first come to an end. Only after that we will see the stocks of good performing companies getting re-rated. APSEZ is one possible candidate, alongwith many others.
Adani Ports & SEZ Ltd. (APSEZ) has posted another strong set of numbers for Q4-FY'15. It has posted a very healthy Y-o-Y growth of 42% in it's Total Income for the Quarter gone by. And this comes on the back of 32% posted in Q2 and 38% posted in Q3 for this fiscal. This is an excellent momentum of growth that the company has managed to build up in the recent quarters. Remember that APSEZ is amongst the largest Logistics companies in India, primarily involved in Port operations & associated SEZ. A strong growth in this company's business means that there has been significant growth in Import-Export activities in India, which in turn indicates that the economic activities in the country are on the up swing.
( Click here for Adani Ports' Easy Results Summary page. )
It's been just 1 year of the Modi Govt and things are being put in place to ensure that the country's growth rate picks up to 8%+ levels. The Make-in-India push will start showing on the ground in the couple of years time. This could boost India's participation in Global trade, in turn resulting in increased volumes of Import-Export of goods. All this will benefit companies operating in the Ports Logistics business. APSEZ is clearly preparing itself to grab a good chunck of this increased volumes of goods being shipped into or out of India. I won't be surprised to see APSEZ doubling it's Total Income in 3 years time or tripling in 5 years time, from the current levels.
In the recent few weeks we have seen the Nifty index moving from levels closer to 9000 to levels closer to 8000 now. Many of the stocks, even of Bluechip companies, have corrected in the region of 10% to 25% during this time. But look at APSEZ's stock price chart above. This stock has remained more or less steady in the Rs.300 to 330 range, despite the massive correction happening with most other stocks. This shows the strength in APSEZ's stock price. I think there are good chances of APSEZ's stock getting re-rated to a higher P/E ratio in the next 6-12 months. Currently it trades at a P/E ratio of about 29-30. I think we could see this being increased to about 35 in the coming months. It may not happen immediately. The current correction in markets should first come to an end. Only after that we will see the stocks of good performing companies getting re-rated. APSEZ is one possible candidate, alongwith many others.
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