Edelweiss's research report on Adani PortsAdani Ports and SEZ (Adani) has announced expansion of its existing capacity at Container Terminal 3 (CT3) to 3.1mn TEUs, of which 1.2mn TEUs will exclusively handle transhipment containers. The terminal’s current capacity is 1.5mn TEU and it handled ~900k TEUs cargo in FY15 with transhipment accounting for 30% of the same. While the finer commercial details of expansion are being finalised, we expect a similar revenue sharing model as the existing JV terminals. However, factoring in lower margin in transhipment cargo and advancement of capex, we have marginally tweaked the TP to INR334 (INR 337 earlier). Maintain ‘BUY’.While transhipment cargo margins are lower, volumes are higher due to two moves (unloading and loading) per container handled. However, considering the earlier-thanexpected capex for the JV terminal (not factoring land/asset sale benefits) we have marginally revised the SOTP based TP to INR 334/share. Considering the ~24% earnings (FY15-17E) CAGR and 12.4x FY17E EV/EBITDA, we believe the stock is attractive. Maintain ‘BUY’/SP. For all recommendations, click here Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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