ICICI Direct is bearish on Great Eastern Shipping has recommended sell rating on the stock with a target price of Rs 315 in its research report dated February 08, 2017.
ICICI Direct's research report on Great Eastern Shipping
Gesco’s revenues for Q2FY17 de-grew 23% YoY to Rs 749.4 crore (Idirect estimate: Rs 833.7 crore). On account of historic low utilisation levels for offshore segment, revenues of the segment de-grew 22.5% YoY to Rs 357.5 crore. However, with a recovery in BDI and tanker rates, revenues from the shipping segment grew 6% YoY to Rs 569.4 crore. Total revenue days for the shipping & offshore segment were at 3428 days and 1723 days, respectively.
The outlook for offshore continues to remain bleak, which would further put pricing pressure on renewals of offshore assets. The glut like situation in the tanker, dry bulk and offshore segments affirm our cautious view on the shipping sector. We roll over our estimates to FY19 and assign a P/BV multiple of 0.45x. We have a SELL rating with a target price of Rs 315.
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First Published on Feb 11, 2017 02:42 pm