Shares of Adani Ports & Special Economic Zone jumped nearly 6% and hit a 52-week high of Rs 1,287.50 on the NSE on Monday, following a strong set of December quarter earnings. Buy ratings from a clutch of top domestic brokerages like Kotak Institutional Equities, Motilal Oswal, and Nuvama also fuelled the rally.

On Friday, the Adani Ports shares extended their lead to nearly 7% in two sessions. The stock had ended with gains following its earnings during market hours on Thursday.

Exactly a year back (February 3, 2023), the stock of India’s largest ports operator plunged to its 52-week low of Rs 395.10 in the wake of the Hindenburg report.

Adani Ports reported a 68% growth in its consolidated net profit at Rs 2,208 crore for the quarter ended December. It was Rs 1,315 crore in same period last year. Revenue from operations in the third quarter rose 44% year-on-year (YoY) to Rs 6,920 crore.

Read more: Adani Ports Q3 Results: Net profit jumps 68% YoY to Rs 2,208 crore

Nuvama: Buy | Target: Rs 1,415

Kotak has jacked-up FY24E/25E PAT by 13%/18% and raised the DCF-based target price of Rs 1,415 from an earlier Rs 958 while retaining a ‘Buy’. APSEZ reported a strong 3QFY24 with highest-ever cargo volumes primarily driven by dry cargo, containers and crude, this brokerage said. “This has also led to APSEZ upgrading the guidance to 400 MMT for FY24E, from 370–390 MMT earlier,” Kotak said.In its view, the logistics business is also on a healthy growth trajectory and this is very likely to sustain. The company also achieved the targeted 2.5x net debt-to-EBITDA levels. Q3FY24 performance should lead to earnings upgrades on Street, Kotak said.

Motilal Oswal: Buy | Target: Rs 1,470

Motilal has marginally increased its estimates with improved growth outlook and reiterated a ‘Buy’ rating with a revised target price of Rs 1,470 premised on 16x FY26E EV/EBITDA.

“APSEZ has a diversified cargo mix along with a sticky cargo and customer base. The operational ramp-up at the recently acquired ports is expected to drive a 14% growth in cargo volumes over FY23-26. This would drive a revenue/EBITDA/PAT CAGR of 19% over FY23-26,” Motilal Oswal note said.

Kotak Equities: Buy | Target: Rs 1,400

Kotak retained its near-term estimates and increased the fair value by 4% to Rs 1,400 on higher medium-term estimates while suggesting a ‘Buy’ again. APSEZ has not seen any meaningful impact of the Red Sea crisis nor does it consider any meaningful competitive threat to Mundra’s volumes, Kotak said. The company has also displayed how its network effect has started reflecting in higher coastal shipping volumes—contributed 4% of growth in 9MFY24.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)

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