Container Corporation of India - Q1FY21 Result Update - ICICI Securities

Concor reported weak numbers with profitability much below I-direct estimates while revenues came in line with I-direct estimates. Operationally Exim volumes de-grew 20% YoY (realisation de-growth of 11%) while domestic volumes de-grew ~ 25% (realisation grew 5%). Subsequently, Exim revenues de-grew 29% to Rs. 901 crore while domestic revenues de-grew 22% to Rs. 289 crore. Standalone EBITDA margins contracted 1123 bps YoY to 13.4% and absolute EBITDA de-grew 61%. For the quarter, the company recorded Rs. 121 crore as land license fee (LLF) for all terminals in other expenses. This negatively impacted the operational performance. Similarly, PAT de-grew 73% to Rs. 62 crore.

Valuation & Outlook

The DFC connectivity to ports is expected to be completed towards the end of FY21. It is expected that the North-West DFC connectivity and time bound transit guarantee on the route (that moves 40-45% of Indian freight traffic, of which 40% currently moves on rail and Concor holds 70% of rail share) would improve turnaround times of train and lead to higher market share gain for rail against the road players. In spite of the challenges in the near to medium term, Concor remains a structural growth story that will play a pivotal role in the changing Indian logistics landscape (DFC, containerisation of cargo). We maintain BUY rating with a target price of Rs. 450.

For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_ContainerCorp_Q1FY21.pdf

Shares of CONTAINER CORPORATION OF INDIA LTD. was last trading in BSE at Rs.377.25 as compared to the previous close of Rs. 386.35. The total number of shares traded during the day was 223135 in over 9595 trades.

The stock hit an intraday high of Rs. 394.95 and intraday low of 376.2. The net turnover during the day was Rs. 85232540.

Source : Equity Bulls

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