Axis Direct's research report on Gateway DistriparksMuted quarter, but volume uptick likely Gateway Distriparks’ (GDPL) Q1FY17 performance was lower than estimate, primarily on lower Rail profitability (higher empty losses and trade discounts, which doubled YoY); rail volumes grew 3% QoQ. While Chennai/Vizag CFS volumes rebounded (up 8% QoQ), Mumbai volumes were muted given higher dependence on exports – this continued pressure on CFS operating margin (flat QoQ). We revise downwards our FY17-18 EBITDA by 7% to factor in lower Rail / CFS margin as near-term growth may remain tepid. However, given strategic locations of existing / upcoming terminals (operational in H2FY17). Reiterate BUY with So TP-based TP of Rs 330 (Rs 110 for CFS, Rs 180 for Rail, Rs 40 for Snowman).
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