Adani Ports share price tanks over 1% despite 5% jump in Q4 net profit; Should you buy, sell, hold Adani Ports?

Adani Ports and Special Economic Zone share price tanked 1.23% to Rs 725 today despite the company’s net profit rising 5.1% to Rs 1,158.88 crore from Rs 1,102.61 crore in the same period last year. Revenue from operations jumped 40% to Rs 5796.85 crore from Rs 4,140.76 crore in Q4FY22. The board declared a dividend of Rs 5 (250%) per equity share of Rs 2 each fully paid up for the fiscal 2023. Adani Ports shares have jumped 6.6% in the past one month and have fallen nearly 18% in the last 6 months.

Should you buy, sell or hold Adani Ports stock?

Kotak: Buy – Fair Value: Rs 835 (15.17% upside)

“ADSEZ reported in-line results adjusted for the Haifa consolidation. More importantly, it sustained net debt to EBITDA at ~3X YoY in spite of the large investments made in FY2023. It expects FY2024 to see healthy mid-teens growth and a material decline in net debt to EBITDA to 2.5X. We marginally cut our estimates and increase FV to Rs 835 from Rs 810 on roll-forward,” said analysts at Kotak Institutional Equities. The brokerage continues to build in a high 14% CoE and would await further progress on the reduction in cash flow items linked to ICD given/received (gross amount high though down 50% yoy) and further clarification/reduction in large outstanding security deposits given to EPC contractors against capital commitment (have declined for the second-straight year).

Nuvama: Buy –  Target Price: Rs 956 (31.86% upside)

“APSEZ continues to add its offerings aggressively across the businesses in order to provide end-to-end solutions, which is a key differentiator in adding volumes and achieving the transport utility status. FY24E growth should sustain multiples and we maintain ‘BUY/SO’ with an unchanged target price of Rs 956,” said analysts at Nuvama Institutional Equities.

JM Financial: Buy – Target Price: Rs  850 (17.24% upside)

“We raise our estimates by up to 3-4% to reflect 4QFY23 performance and outlook. We maintain a BUY rating with SoTP-based Mar’24TP of Rs 850 (earlier Rs 800),” said analysts at JM Financial.

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