Price targets for Adani Ports & Special Economic Zone Ltd. (Adani Ports or APSEZ) have been raised in response to a robust 40–45% YoY increase in key port and overall operating metrics as well as a 60% increase in adjusted profit. According to analysts, the first nine months' 24% increase in volume was evenly distributed among the main cargo categories, with equal contributions from Mundra, non-Mundra ports, and inorganic boost.
"APSEZ does not perceive any significant competitive threat to Mundra's volumes, nor has it observed any meaningful impact from the Red Sea issue. It emphasized how its network effect - which accounted for 4% of growth in 9MFY24 - has begun to show itself in increased quantities of coastal shipping. We maintain our near-term projections and raise FV by 4% to Rs 1,400 in the longer future', the statement stated.
According to JM Financial, in light of the 3QFY24 performance and the better prognosis, it has increased its projections by three to five percent. In order to indicate optimism about growth prospects, it has valued Adani Ports at 16 times EV/Ebitda, which is 10% more than its 3-year median of 14.5 times. The broking company recommended a target of Rs 1,430 for March 2025.
"APSEZ has also finished purchasing Karaikal Port and selling its holdings in Myanmar. By having non-Mundra volumes contribute 46% in 9MFY24 (compared to 44% YoY), the corporation is reducing the risk of concentration. Amidst the geopolitical turmoil, APSEZ also stated that it has not experienced any volume disruption for its Haifa port thus far, according to Nuvama. The firm has increased its target price for the stock from Rs 958 to Rs 1,415.
According to Motilal Oswal, Adani Ports has a client base and a varied cargo mix in addition to sticky cargo. Over FY23–26, it is anticipated that the operational ramp-up at the recently acquired ports will propel a 14% increase in cargo volumes. According to it, this could result in a 19% CAGR in revenue, EBITDA, and PAT over FY23–26.
"We maintain our BUY rating with a revised target of Rs 1,470 and slightly raise our estimates with an improved growth outlook.
Throughout Friday's trading, the stock gained more than 4%. A goal of Rs 1,280 was recommended by Goldman Sachs, Rs 1,368 by Citi, Rs 1,370 by HSBC, Rs 1,380 by CLSA, and Rs 1,428 by Morgan Stanley.
