December 01, 2016 / 11:43 IST
Q2FY17 performance was in line, as Panvel volumes grew 8% YoY (flattish QoQ, primarily led by imports; +15% YoY in Q1).However, adj. EBITDA margin (Rs/teu; ex-forex) declined 12% QoQ due to heavy monsoon which led to (a) higher operating overheads due to delay in transportation and (b) adverse EXIM mix, as export volumes (primarily agri-based) slowed.
Vapi’s Q2 volumes improved to 1,225 teus (325 teus in Q1); Rail siding expected to be complete by Mar,’17 (construction delayed due to heavy monsoon). To factor in this delay, we lower our Vapi’s volume estimates, resulting in 15% decline in our FY17/18E EPS. Maintain BUY with revised TP of Rs 225 (18x FY18E EPS; Rs 250 earlier) given benefits from (a) timely capacity expansion at Panvel and (b) volume ramp-up at Vapi, given attractive pricing (25% lower than peers’).
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