Nomura retains reduced rating on Adani Ports, raises earnings estimates by up to 13%
The research firm has raised the earnings estimates of Adani Ports by 11-13 percent over FY18-19 which will factor in better traffic growth and lower debt while on the other hand return on equity (RoE) is set to fall due fall in margins and higher tax burden.
Moneycontrol News
Research firm Nomura has come out with a report on Adani Ports & Special Economic Zone and has maintained a reduced rating on the stock. However, the firm has hiked price target to Rs 319 from Rs 234.
The research firm has raised the earnings estimates of Adani Ports by 11-13 percent over FY18-19 which will factor in better traffic growth and lower debt while on the other hand return on equity (RoE) is set to fall due fall in margins and higher tax burden.
Nomura believes that Adani's Mundra plant volume growth is to be driven by 15 percent compound annual growth rate (CAGR) in containers over FY17-20 and expects revenue and net profit to grow at CAGR of 16 percent and 3 percent over FY17-20 with margins around 11-12 percent.
However, the house is of the view that poor free cash flow generation is likely to continue in the near-term.
At 10:50 hrs Adani Ports and Special Economic Zone was quoting at Rs 386.05, up Rs 3.45, or 0.90 percent. It has touched an intraday high of Rs 387.50 and an intraday low of Rs 379.40.
