MEXICO: Adani Ports and SEZ shares fell as much as 1.6 per cent to Rs 290.65 on Tuesday, extending their decline to the sixth day. The Adani group company had on Monday announced its second quarter earnings during market hours. The stock had declined 0.03 per cent yesterday.
The port operator reported a 16 per cent year-on-year increase in its consolidated net profit to Rs 667 crore while sales rose 40 per cent to Rs 1,842 crore, largely in line with the Street’s expectations.
The Adani group company is India’s largest private port operator. It operates eight ports in India, including the largest private port of Mundra port in Gujarat. Apart from handling ships, Adani Ports also offers logistics services.
However, adjusted for an exceptional income of Rs 657 crore attributable to lease of a land parcel to a subsidiary, net port revenue at Rs 880 crore in Q2 represents a growth of just 4 per cent “which is significantly below our estimates”, brokerage Nomura said.
Also, adjusted for the exceptional income, the port EBITDA (operating income) was Rs 579 crore below estimates of Rs 744 crore, Nomura said.
Adani Ports handled 36 million tonne (MT) in the second quarter on a consolidated basis, an increase of 4 per cent over corresponding period last year. But it was below Nomura’s estimates of 40.5 million tonnes. The management attributed lower-than-expected cargo growth to shutdown of railway lines in Gujarat due to monsoons and to lower coal cargo volumes, brokerage PhillipCapital said in a note.
Adani Ports sees coal volumes remaining weak over the next few quarters, but compensated by uptick in chemical/liquid cargo, PhillipCapital added.
Nomura has a “reduce” rating on the stock, with a target price of Rs 309. PhillipCapital has a buy rating on the stock though it has reduced the target price to Rs 350 from Rs 400 earlier.
