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�� Results slightly ahead of estimates: Gateway Distriparks’ (GDL’s) standalone
revenues stood at Rs601m, a growth of 43% YoY; however, flat (-1%) QoQ.
Volumes were flat sequentially; however, higher realisations (+3% QoQ) led to
better-than-expected top-line performance. Though dwell time decreased from
12.5 days in Q1FY12 to 11 days, new services and a change in container mix
(container weights) led to increased realisations. Strong top-line growth led to
continued good performance on the margin front, reported at 56.8% for
Q2FY12. On account of the company coming under full tax this year, PAT growth
stood subdued at 11% YoY and 1% QoQ at Rs226m.
�� Drop in Chennai volumes result in sequentially flat CFS volumes: In Q1FY12,
Chennai operated at abnormally high utilizations exceeding 100%, thereby,
leading to certain inefficiencies. This was corrected during this quarter, which
led to Chennai’s volumes reducing by 17% QoQ. Overall volumes remained flat
sequentially; however, grew 13% YoY.
�� Rail business going strong: Rail business continued to do well in Q2FY12 on the
back of a continuous improvement in volumes and increase in contribution from
EXIM cargo, resulting in better efficiencies. Rail volumes grew 36% YoY and 10%
QoQ to 43,057 TEUs, translating into a 29% YoY increase in revenues in Q2FY12.
As a result, Rail EBITDA grew 74% YoY to Rs164.5m, translating into a profit of
Rs51.3m for the quarter as against a loss of Rs33.5m in Q2FY11. The company’s
focus continues on the Exim side and expects to increase the share of Exim
cargo in their volume mix to 80%+ from the current 76%.
�� Valuations: We are valuing CFS and the cold chain business at PER of 13x FY13
which gives us a value of Rs132/share. Further, we are valuing the rail business
at P/B of 1.25, with a 10% holding company discount. This translates into
Rs29/share, assuming Blackstone’s stake at a midpoint of 43.5%, thereby, GDL’s
stake at 56.5%. The SOTP value works out to Rs162. We maintain ‘Accumulate’.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� �
�� Results slightly ahead of estimates: Gateway Distriparks’ (GDL’s) standalone
revenues stood at Rs601m, a growth of 43% YoY; however, flat (-1%) QoQ.
Volumes were flat sequentially; however, higher realisations (+3% QoQ) led to
better-than-expected top-line performance. Though dwell time decreased from
12.5 days in Q1FY12 to 11 days, new services and a change in container mix
(container weights) led to increased realisations. Strong top-line growth led to
continued good performance on the margin front, reported at 56.8% for
Q2FY12. On account of the company coming under full tax this year, PAT growth
stood subdued at 11% YoY and 1% QoQ at Rs226m.
�� Drop in Chennai volumes result in sequentially flat CFS volumes: In Q1FY12,
Chennai operated at abnormally high utilizations exceeding 100%, thereby,
leading to certain inefficiencies. This was corrected during this quarter, which
led to Chennai’s volumes reducing by 17% QoQ. Overall volumes remained flat
sequentially; however, grew 13% YoY.
�� Rail business going strong: Rail business continued to do well in Q2FY12 on the
back of a continuous improvement in volumes and increase in contribution from
EXIM cargo, resulting in better efficiencies. Rail volumes grew 36% YoY and 10%
QoQ to 43,057 TEUs, translating into a 29% YoY increase in revenues in Q2FY12.
As a result, Rail EBITDA grew 74% YoY to Rs164.5m, translating into a profit of
Rs51.3m for the quarter as against a loss of Rs33.5m in Q2FY11. The company’s
focus continues on the Exim side and expects to increase the share of Exim
cargo in their volume mix to 80%+ from the current 76%.
�� Valuations: We are valuing CFS and the cold chain business at PER of 13x FY13
which gives us a value of Rs132/share. Further, we are valuing the rail business
at P/B of 1.25, with a 10% holding company discount. This translates into
Rs29/share, assuming Blackstone’s stake at a midpoint of 43.5%, thereby, GDL’s
stake at 56.5%. The SOTP value works out to Rs162. We maintain ‘Accumulate’.
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