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http://content.icicidirect.com/mailimages/ICICIdirect_ContainerCorporation_Q4FY12.pdf
O p e r a t i n g m a r g i n s d e c l i n e …
Container Corporation (Concor) reported its Q4FY12 numbers with a
topline of | 1071.1 crore and PAT of | 227.1 crore. Revenues, which
grew 7.6% YoY, were marginally above our estimates mainly on account
of better-than-expected Exim (| 843.3 crore vs. expected | 833.6 crore)
and domestic sales (| 227.8 crore vs. exp. | 206.7 crore). Exim volumes
stood at 535575 TEUs, exhibiting a 3.4% YoY increase while domestic
volumes of 124907 TEUs continued to exhibit a downward trend by
declining by 10.4% YoY. Domestic volumes have reduced considerably
since the sharp hikes in haulage charges on certain commodities and
due to private players chipping away at Concor’s market share. The
EBITDA margin of 20.9% in Q4FY12 contracted by 251 bps due to yearend discounts, higher other expenses on account of break van charges
paid to Railways and higher empty running cost. Other income grew
49.3% YoY due to higher interest income, increased number of auctions
to clear old containers and dividend payment from JV partners.
Outlook for Concor
ƒ Concor’s FY12 Exim volumes increased 5.8% while domestic
volumes decreased 13.9% due to a change in rail haulage structure
and competition from private companies. Going forward, we expect
8% and 6.3% CAGR in Exim and domestic volumes, respectively,
factoring in inclusion of pig iron and sponge iron in notified
commodities. We expect lower EBITDA margins of 23.5% and 23.6%
in FY13E and FY14E, respectively
V a l u a t i o n
Concor maintains its market leadership and has the strongest balance
sheet among its logistics peers. However, privatisation of container
haulage has put pressure on its operating margin and put its market
dominance at risk. We recommend a BUY rating on the stock based on
13x FY14 EPS with a target price of | 994.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
http://content.icicidirect.com/mailimages/ICICIdirect_ContainerCorporation_Q4FY12.pdf
O p e r a t i n g m a r g i n s d e c l i n e …
Container Corporation (Concor) reported its Q4FY12 numbers with a
topline of | 1071.1 crore and PAT of | 227.1 crore. Revenues, which
grew 7.6% YoY, were marginally above our estimates mainly on account
of better-than-expected Exim (| 843.3 crore vs. expected | 833.6 crore)
and domestic sales (| 227.8 crore vs. exp. | 206.7 crore). Exim volumes
stood at 535575 TEUs, exhibiting a 3.4% YoY increase while domestic
volumes of 124907 TEUs continued to exhibit a downward trend by
declining by 10.4% YoY. Domestic volumes have reduced considerably
since the sharp hikes in haulage charges on certain commodities and
due to private players chipping away at Concor’s market share. The
EBITDA margin of 20.9% in Q4FY12 contracted by 251 bps due to yearend discounts, higher other expenses on account of break van charges
paid to Railways and higher empty running cost. Other income grew
49.3% YoY due to higher interest income, increased number of auctions
to clear old containers and dividend payment from JV partners.
Outlook for Concor
ƒ Concor’s FY12 Exim volumes increased 5.8% while domestic
volumes decreased 13.9% due to a change in rail haulage structure
and competition from private companies. Going forward, we expect
8% and 6.3% CAGR in Exim and domestic volumes, respectively,
factoring in inclusion of pig iron and sponge iron in notified
commodities. We expect lower EBITDA margins of 23.5% and 23.6%
in FY13E and FY14E, respectively
V a l u a t i o n
Concor maintains its market leadership and has the strongest balance
sheet among its logistics peers. However, privatisation of container
haulage has put pressure on its operating margin and put its market
dominance at risk. We recommend a BUY rating on the stock based on
13x FY14 EPS with a target price of | 994.
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