Gujarat Pipavav (GPPL) reported a strong operational performance for Q3CY13. PAT grew 716%y-o-y to R44.1 crore (on adjusted base), sharply above estimate of R30.4 crore, led by higher cargo and higher margins. PAT on reported basis grew 440%y-o-y.
Container volumes grew 29.4%y-o-y to 1,63,000 TEUs (on a low base) led by vessel upsizing and market share gains. Bulk volumes grew 32%y-o-y to 9,86,000 tonne, led by coal cargo. GPPL added a new India-West Asia service w.e.f September 13.
Average realisations grew 7.1% y-o-y to R427/tonne led by higher container realisations. Ebidta/tonne grew 54.3% y-o-y to R208/tonne. Revenues grew 38% y-o-y to R1,260 crore, Ebidta grew 99% y-o-y to R61.4 crore (est of R54.1 crore). Ebidta margin grew to 48.6% from 33.8% in Q3CY12 (est of 44.1%). Other income grew 25.6% y-o-y to R9.8 crore led by a dividend income of R3.8 crore from PRCL.
Container tariffs grew ~15%y-o-y, led by rupee depreciation and 4-5% tariff hike wef August 13. Bulk realisations were lower due to higher coal volumes and discounts. GPPL’s operating performance continues to remain strong and we expect 68% CAGR in earnings over CY12-14E. We like GPPL for its strong parentage, geographical advantage and scalability potential. Stock trades at 13.2x CY14E earnings and 1.5x P/B. Maintain outperformer with price target of R66.