Buy Container Corporation; target of Rs 1560: ICICI Direct

ICICI Direct is bullish on Container Corporation has recommended buy rating on the stock with a target price of Rs 1560 in its research report dated May 03, 2018.

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May 15, 2018 / 17:44 IST

26 Aug, 2025 12:21

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ICICI Direct's research report on Container Corporation

Revenues grew 12% YoY to Rs 1559 crore (I-direct estimate: Rs 1472 crore). While domestic revenues grew 16% YoY to Rs 380 crore (I-direct estimate: Rs 325 crore), Exim revenue (excluding SIES income) grew 10% YoY to Rs 1179 crore (I-direct estimate: Rs 1148 crore) EBITDA margins increased 177 bps YoY to 22.2% (I-direct estimate: 19%), mainly due to lower other expenses. Subsequently, EBITDA grew 21% to Rs 347 crore (I-direct estimate: Rs 280 crore) Net profit de-grew 12% YoY to Rs 294 crore (I-direct estimate: Rs 305 crore) mainly due to lower-than-estimated SEIS income (Rs 82 crore in Q4FY18 vs. Rs 212 crore in Q4FY17) & lower other income. Lower SEIS income and other income was offset up to a limit by lower tax rate in Q4FY18 (26.1% of adjusted PBT) vs. Q4FY17 (50.7% of adjusted PBT).

Outlook

MMLP operations have started and are expected to contribute meaningfully from FY19. Third party Logistics (3PL) is another thrust area with warehousing, commodity and automotive handling along with private freight terminal (PFTs) expected to buoy revenue growth. We believe Concor, post commencement of these services, would operate on an altogether different business model compared to current CTO focused. Additional triggers like benefits from JNPT phased expansion and efficiencies from dedicated freight corridor (DFC) remain an upside risk to our estimates. We maintain BUY with a target price of Rs 1560, assigning a P/E multiple of 25x FY20E expected EPS of ~Rs 62.

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