Adani Ports shares become multibagger from their 52-week lows of Rs 394.95 as the price topped Rs 790 last week, but the stock has subsequently retreated roughly 9%.
CLSA has kept its ‘buy’ rating on Adani Group and raised its target price to Rs 878 from Rs 792. The trading firm stated that APSEZ is preparing for its next phase of growth.
Adani Ports announced a 5% year-on-year (YoY) increase in consolidated net profit for the quarter ending March 31, 2023, at Rs 1,159 crore. In the previous fiscal year, it reported a net profit of Rs 1,103 crore. In Q4FY23, the company’s income from operations increased by 40% to Rs 5,797 crore, up from Rs 4,141 crore in Q4FY22.
The company outperformed its highest-ever revenue and EBITDA guidance issued at the start of the year. “Our strategy of geographical diversification, cargo mix diversification, and business model transition to a transport utility is enabling robust growth,” APSEZ CEO Karan Adani said.
The financial situation
The Adani Group’s shares was trading at Rs 724.45, down 1.34 percent, at 09:29 a.m. The stock was among the worst performers on the Nifty 50.
According to ICICI Securities, profit after tax was lower than expected due to an unusual charge of Rs 1,273 crore, headed by a non-cash impairment produced by the sale of Myanmar port assets.
EBITDA margin increased to 56.4 percent from 49.7 percent a year ago.
Despite current EXIM market downturn, Adani Ports has maintained its FY24 estimate, which includes 10-12 MMT volumes from the newly acquired Karaikal port, according to ICICIDirect’s first cut.
Concerning the Concor transaction, management will make a cautious decision when the divestment resumes,” it added.
These deals cost roughly Rs 18,000 crore in total investment. ASPEZ also spent over Rs 9,000 crore on capital expenditure (capex) last year.
Following the release of Q4 data, Adani Ports shares fell 2% to Rs 721.1 on Wednesday, from a previous closing of Rs 734.30 on Tuesday.
Budget for Fiscal Year 24
- Cargo volumes are expected to reach 370-390 million metric tonnes (MMT), generating revenue of around Rs 24,000-25,000 crore.
- The predicted EBITDA (profits before interest, taxes, depreciation, and amortisation) is in the range of Rs 14,500-15,000 crore.
- Furthermore, total capital expenditure (capex) for the year is estimated to be approximately Rs 4,000-4,500 crore.
According to JM Financial’s report, management forecasted port volume of 370-390 million tonnes for FY24 (9-15 percent YoY), while retaining its FY25 volume objective of 500 million tonnes.
Shares of Adani Ports turned multibagger from their 52-week lows at Rs 394.95 as the stock hit Rs 790 last week amid the optimism over fresh inflows, the Supreme Court verdict and sale of non-core assets. However, the stock has corrected about 9 per cent since then.
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