Motilal Oswal Forecasts Surge In Cargo Volume At Adani Ports

Brokerage firm Motilal Oswal projects a 10% surge in cargo volume between April 2023 and March 2026 at Adani Ports and Special Economic Zone Ltd., fuelled by operational enhancements at recently acquired ports. The surge is anticipated to drive revenue, operating income or earnings before interest, tax, depreciation and amortisation, and net profit at compound annual growth rates of 14%, 15%, and 19%, respectively, during the same period.

The firm estimates a CAGR of 13% in cash flow from operations over the same period, earmarked for capital expenditure and debt reduction, as the research firm said in a note on Monday. Adani Ports has demonstrated consistent robust performance in cash flow from operations from April 2018 to March 2023, highlighting its financial resilience and operational efficiency, it said.

Motilal Oswal reiterated a ‘buy’ rating on the stock—with a price target of Rs 1,590—implying a potential upside of 20.3% from Tuesday’s close. That’s the second-highest price target among the analysts tracked by Bloomberg.

Shares of Adani Ports extended gains for the third consecutive trading session. The stock ended 0.1% higher at Rs 1,322.10, as compared with a 0.1% gain in the country’s benchmark S&P BSE Sensex. The scrip has returned 29.1% so far this year.

Among the 21 analysts tracked by Bloomberg, 19 of them have a ‘buy’ rating on the stock.