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Container Corporation (Concor) reported its 2QFY2011 results, which were above our
expectations on account of better Exim performance. The company reported a 1.6% yoy
decline in total revenue to `944cr, against our estimate of `891cr. There was moderate
decline of 5.2% yoy in the company’s Exim revenue to `733cr, which came in as a positive
surprise as volumes at JNPT were impacted on account of shutdown of operations for five
days in August and prolonged monsoon. Domestic revenue grew by 13.1% yoy to `211cr,
above our expectation. We were positively surprised by higher EBIDTA margin, which came
in much above our estimate (27.0%) at 27.7%. Margins of the Exim business grew by
150bp yoy and 90bp qoq to 28.5%. However, margins of the domestic segment declined
by 290bp yoy and 360bp qoq to 9.9%. Consequently, PAT grew by 1.2% yoy to `206.7cr,
which was above our estimate (`187cr). At the CMP of `1,292, Concor is trading at 17.8x
its FY2012E EPS and 3.2x P/BV on FY2012E. We maintain our Reduce rating on the stock
with a Target Price of `1,194. We will be releasing a detailed note after the conference call
today.
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