In the business of providing supply chain management services to the oil and gas liquid fuels market, Aegis Logistics has benefitted significantly from the turning fortunes of the oil, gas and chemicals industry.
The only listed player in this space, the stock has delivered a whopping 355 per cent over the year. Much of that however was led by PE re-rating, as its trailing twelve months per share earnings grew just by over 18 per cent (Rs 14.4 now) in the same period.
Expansion of handling capacities at its existing sites in Mumbai, likely acquisition of new sites along the coastline and lack of any significant competition in its business may have influenced the re-rating to a certain extent.
The bulk of it, however, seems to have come on the back of the company's presence in autogas retailing (sub-segment of gas division). With the government partially deregulating oil prices, the cost advantages of auto LPG have come to the fore.
It is in this regard that Aegis' 68 retail outlets and plans to increase it to 300 in the coming years puts it in a sweet spot. It has also tied up with Essar Oil to further increase in retail footprint.
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