Adani Ports Q4 preview: Net profit likely to fall, sales to rise; board to consider dividend

The analysts further projects that the board is also likely to announce a dividend payout for FY24 at its meeting tomorrow.

The focus will be on worldwide container trade and the operations of international ports, while investors will also monitor cargo volume projections for FY25, alongside capital expenditure forecasts for the current fiscal year.

Also read: Adani Power Q4 results: Net profit down 48% YoY to ₹2,737 crore, revenue up 30%

According to Equirus Capital, Adani Ports will witness a 12.4 percent year-on-year decline in net profit, with figures dropping to ₹2,129.60 crore from ₹2,432.30 crore in the corresponding quarter of the previous year. 

Conversely, sales are expected to surge by 20.7 percent year-on-year, reaching ₹6,996.40 crore compared to ₹5,796.90 crore in the previous year. Furthermore, the EBITDA margin is anticipated to stand at 60 percent, marking a substantial increase of 377 basis points year-on-year.

On the other hand, brokerage firm Elara Capital anticipates a 1.8 percent year-on-year decline in adjusted profit, amounting to ₹2,251.80 crore. The brokerage forecasts sales to reach ₹6,958.40 crore, reflecting a 20 percent increase.

“ADSEZ outperformed all major ports in India on volumes (through to Feb’24) that grew at 4.5 per cent YoY. We expect ADSEZ’s port revenue to grow 26% YoY with port Ebitda margin at 71 per cent, up 130 bps YoY. ADSEZ, due to its diversified presence and inorganic expansions, continue to gain market share as also outperforming its guidance,” the brokerage firm said.

In the fourth quarter of the fiscal year 2023-24, Adani Ports managed a total volume of 108.5 million metric tonnes (MMT), potentially contributing to a notable rise in revenue. Throughout the entire fiscal year 2023-24, Adani Ports realized a 24 percent increase in volume, reaching 420 MMT, exceeding its adjusted projection of 400 MMT. The company has set a target of 500 MMT for the fiscal year 2024-25.

Also read: Adani Wilmar Q4 results: Net profit rises 67% YoY to ₹157 crore, revenue down 3%

Moving forward, all eyes are on the earnings ramifications stemming from the disruption in the Red Sea. Thus far, there has been no notable impact. Although the volume at Haifa Port remains largely unaffected, an extended disruption could exacerbate container shortages and decrease container volume. Management has indicated that the disrupted routes constitute 10 percent of Adani Ports volumes, with no significant volume impact reported as of January.

Adani Ports has demonstrated robust cash flow from operations (CFO) over FY 2018-23, amounting to ₹43,300 crore at a compounded annual growth rate (CAGR) of 16 percent. While prioritizing the optimization of acquired assets for consistent cash flows, Adani Ports is projected to achieve a 13 per cent CFO CAGR through FY 2024-26. This influx of cash flow is likely to be allocated towards capital expenditure and debt reduction, as outlined in a research note by Motilal Oswal Securities.

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Published: 01 May 2024, 10:59 PM IST