Visit http://indiaer.blogspot.com/ for complete details Allcargo acquires controlling stake in Hong Kong-based companies
Allcargo Global Logistics Ltd. (AGLL) has announced that in furtherance to the expansion
plans of the Non Vessel Owning Common Carrier (NVOCC) business, its step down wholly
owned subsidiary has acquired business rights and controlling stake in Hong Kong-based
companies engaged in NVOCC business in China and other parts of eastern regions.
AGLL has guided that the aforesaid acquisition would strengthen the EBITDA by adding
approximately US $3.5mn annually (~5.8% of CY2010E EBITDA). Further, AGLL has
acquired two vessels of approximately 6,500 dead weight tonnes each to augment the
project cargo movement business. This would help AGLL to capitalise on the opportunities
in the Indian sub-continent, including costal movement by saving on ship chartering and
hiring charges and in planning and execution of project cargo movements in an efficient
and effective manner. At the CMP, the stock is trading at 10.6x CY2011E EPS. We
maintain a BUY rating on AGLL with a Target Price of `195.
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