Container Corporation of India - Q2FY21 Result Update - ICICI Direct
Concor reported strong results that were better than I-direct estimates on all fronts. On volumes front, Exim segment grew 19% QoQ (still down 10% YoY) while domestic volumes grew 35% QoQ (led to flat YoY). Hence, Exim revenues grew 26% QoQ to Rs. 1130 crore while domestic revenues grew 29% to Rs. 373 crore. Standalone EBITDA margins expanded 745 bps QoQ to 20.8% due to better cost control measure by the company and absolute EBITDA doubled. For the quarter, the company recorded Rs. 113 crore as land license fee (LLF) for all terminals in other expenses.
Valuation & Outlook
Concor plans to capture higher realisation by giving complete logistics package to customers and non-participation in low margin short lead distance cargo. It has started first-mile last-mile logistics in 15 of its terminals (also building a mobile app to facilitate customer tie-up). From mid-June onwards it has also begun its coastal services. Further, distribution logistics is expected to gain traction in FY21 amid weaker development in FY20. Despite the challenges in the near to medium term, Concor stays a structural growth story that will play a pivotal role in the changing Indian logistics landscape (DFC, cargo containerisation). We maintain BUY with TP of Rs. 450.
Shares of CONTAINER CORPORATION OF INDIA LTD. was last trading in BSE at Rs.377.95 as compared to the previous close of Rs. 406.85. The total number of shares traded during the day was 290435 in over 10741 trades.
The stock hit an intraday high of Rs. 410 and intraday low of 372. The net turnover during the day was Rs. 110304830.
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