Adani Ports & Special Economic Zone Ltd (Adani Ports) is likely to report a drop in profit for the March quarter despite a 20 per cent-plus growth in sales. All eyes would be on global container trade and the performance of international ports. Besides, investors would also track cargo volume guidance for FY25, in addition to capex guidance for the ongoing financial year. The Adani Ports board would also be considering paying dividend for FY24 at its meeting tomorrow.
Equirus Securities sees Adani Ports reporting 12.4 per cent YoY drop in net profit at Rs 2,129.60 crore compared with Rs 2,432.30 crore in the same quarter last year. It sees sales rising 20.7 per cent YoY to Rs 6,996.40 crore compared with Rs 5,796.90 crore YoY. Ebitda margin is seen at 60 per cent, up 377 basis points YoY.
"Total volume handled at ADSEZ during 4QFY24 stands at 108.5 mmt leading to healthy jump in revenues yoy . We expect operating margins to be in the range of 59-60 per cent given the revenue mix," it said.
Elara Securities sees adjusted profit falling 1.8 per cent YoY to Rs 2,251.80 crore. The brokerage projected sales at Rs 6,958.40 crore, up 20 per cent.
Adani Ports & SEZ’s Q4 volume rose 26 per cent YoY to 108 mmt with FY24 volume rising 24 per cent YoY to 420 mmt.
"ADSEZ outperformed all major ports in India on volumes (through to Feb’24) that grew at 4.5 per cent YoY. We expect ADSEZ’s port revenue to grow 26% YoY with port Ebitda margin at 71 per cent, up 130 bps YoY. ADSEZ, due to its diversified presence and inorganic expansions, continue to gain market share as also outperforming its guidance," Elara Securities said.
What to watch?
BNP Paribas noted that Adani Ports acquired Gopalpur port with FY23 cargo volumes of 7.3 mt and FY25 (company) estimated volumes of 12 mt. With the acquisition and potential turnaround in operations of Gangavaram and Karaikal ports, BNP Paribas expect Adani Ports to provide cargo volume guidance of 450 mmt-plus (potentially in 470-490 mmt range).
"We will also monitor capex guidance for FY25 and potential management leverage targets (net debt to EBITDA)," it said.
Adani Ports credit rating
Ahead of it quarterly results, CARE Ratings announced a credit rating of AAA for Adani Ports proposed NCDs, bank facilities and commercial papers.
Adani Ports' successful track record of turning around port assets post-acquisition and its integrated approach as a transport utility providing services from port gate to customer gate has led to 15 per cent compounded annual growth in volumes for FY19-FY24 as compared to 4 per cent CAGR for all Indian ports, CARE Ratins said.
"The rating is driven by APSEZ’s robust integrated business model, dominant industry position, strong growth in operations with healthy profitability, coupled with high liquidity and low leverage," it said.