Buy Adani Ports; target of Rs 160: Prabhudas Lilladher

Prabhudas Lilladher is bullish on Adani Ports and has recommended buy rating on the stock with a target of Rs 160 in its April 2, 2012 research report.

�Adani port has refinanced the US$2bn bridge loan that it had taken for Abbot Point coal terminal in Australia in May 2011. The refinancing has been done using a combination of an AUD1.1bn and US$0.8bn loan at an interest rate of BBSW+270bps for the AUD loan and 3month US LIBOR+330bps for the USD loan which is largely in line with expectations.�

�The ~9mt HPCL-Mittal Energy refinery in Bhatinda, which has been awaited for a while, has been fully operationalized in the last week of March 2012. This refinery is expected to aid crude volumes at Mundra , as crude will be transported through the 1,017 km cross country pipeline connecting Mundra and Bhatinda. We expect this refinery to contribute ~5mt of additional crude volumes at Mundra in FY13. Adani is expected to witness strong volume pick-up over the next few years, largely aided by higher coal volumes on account of the commissioning of additional phases at Tata UMPP and Adani�s Mundra Power plants as well as scale-up in crude volumes. The company�s volumes are expected to increase from 66m tonnes in FY12 to 115m tonnes in FY15.�

�The company�s stock price has been under pressure on account of negative news flow regarding its probable involvement in a money laundering issue which has been categorically denied by the management. On account of this negative news flow, the company�s stock price has underperformed by 11% in the last one month. However, with company fundamentals in place as well as the positive news flow on the stock, we expect the overhang to clear. At CMP of Rs130, we see a potential upside of 23%. We reiterate our positive stance on the stock with a �BUY� rating,� says Prabhudas Lilladher research report.  

Institutional holding more than 40% in Indian cos

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