CLSA said InnovativeB2B Logistics will add 34 percent to company's rail volume and 49 percent to revenue. "Adani Ports and InLogistics combined is set to become the number one private rail logistics player.
CLSA has maintained positive stance on Adani Ports and Special Economic Zone after the acquisition of InnovativeB2B in logistic space.
While maintaining a buy call on the stock with a price target at Rs 475 (implying a potential 26 percent upside from current levels), the brokerage said one more M&A would strengthen the company's presence in North & East.
On March 28, Adani Logistics, a wholly-owned subsidiary of Adani Ports, signed an agreement to acquire 100 percent in Innovative B2B Logistics Solutions (InLogistics), a rail-based logistic firm controlled by private equity firm True North for an enterprise value of Rs 331.5 crore.
"With this acquisition, we will become the largest private rail and logistics park operator in the country. We see significant synergies in the business across optimising operations and leverage InLogistics' presence for new business," APSEZ chief executive and whole-time director Karan Adani had said.
CLSA said InnovativeB2B Logistics will add 34 percent to the company's rail volume and 49 percent to revenue. "Adani Ports and InLogistics combined is set to become the number one private rail logistics player.
Its post-acquisition leverage shall rise 2 percent in FY20, said CLSA which expects this strategic asset to deliver 16 percent growth in port EBITDA over FY19-21.
Founded in 2006, InLogistics provides integrated logistics services for domestic cargo movement and serves the Eastern and Northern hinterland markets and lists Tata Steel, Tata Sponge Iron, JSW Cement and retail marble traders as its key clients.
InLogistics will add 14 container rakes, one logistics park spread across 38 acres and 3,566 containers to Adani Logistics which currently operates three logistics parks, two Exim yards and one container yard with a capacity to handle 5,00,000 TEU per year.
Adani Logistics is the leading end-to-end logistics service providers in the country with presence across all major markets with expertise in handling retail, industrial, bulk, break-bulk, chemicals & auto cargoes.Disclaimer: The above report is compiled from information available on public platforms. Moneycontrol advises users to check with certified experts before taking any investment decisions.