Adani Ports shares see revisions in stock price targets post Q4 results; should you buy, hold or sell?

Adani Ports & Special Economic Zone Ltd (APSEZ) Q4 results were largely in-line with Street expectations. The Adani group firm's focus on positioning itself into end-to-end logistic player and its FY25 guidance was healthy, increasing growth visibility. A couple of brokerages have increased their price targets on Adani Ports post quarterly earnings.

APSEZ expects volumes of 460–480 mmt in FY25 with Mundra volumes to surpass 200 mmt. It expects consolidated revenues to be in the range of Rs 29,000–31,000 crore with net debt to Ebitda seen in the 2.2–2.5 times range.

Adani Ports expects capex to be in the range of Rs 10,500–11,500 crore. The newly acquired ports and also the Colombo terminal shall start operations during the year, which shall aid volume growth, Nuvama said.

"The company had improved net debt to Ebitda to 2.3 times (versus guidance of 2.5 times). We reckon revenue/Ebitda/PAT shall grow 12 per cent/17 per cent/21 per cent over FY24–26 and raise our DCF-based target price to Rs 1,574 (earlier Rs 1,415) based on change in estimates; maintain ‘BUY’," Nuvama said.

Motilal Oswal said Adani Ports' March quarter performance was largely in line with its estimates. APSEZ is expected to record 2-3 times of India's cargo volume growth, driven by a balanced port mix on the western and eastern coastlines of India and an operational ramp-up at the recently acquired ports, it said.

"Further, the logistics business will also serve as a value addition to the domestic ports business with a focus on enhancing last-mile connectivity. We expect APSEZ to report 11 per cent growth in cargo volumes over FY24-26. This would drive a CAGR of 14 per cent/15 per cent/19 per cent in revenue/ Ebitda/PAT over FY24-26. We largely retain our estimates and reiterate our BUY rating with a revised target price of Rs 1,550," the brokerage said.