Adani Ports defies odds : FY25 volume outlook remains robust amid strikes

AHMEDABAD : While Adani Ports and SEZ Ltd hit a temporary snag in H1FY25, the volume guidance remains strong at 460-480 mmt for FY25, stated a report by Motilal Oswal Financial Services. Volumes in Q1FY25 grew 7 per cent YoY but were affected by a worker strike at Gangavaram Port during Apr-May’24, which normalized in Jun’24. Further, Aug’24 volumes were also impacted by severe weather in Kutch, affecting operations at Mundra and Tuna. The company handled 183 mmt of cargo volumes over Apr-Aug’24.

While H1FY25 volumes were temporarily impacted by a worker strike and weather conditions, the situation is normalized now and the FY25 volume guidance of 460-480 mmt remains unchanged. “APSEZ is expected to record 2-3x of India’s cargo volume growth. APSEZ targets becoming India’s largest integrated transport utility and the world’s largest private port company by 2030. We expect APSEZ to report 11 per cent growth in cargo volumes over FY24-26,” Motilal Oswal Financial Services said.

APSEZ has signed a concession agreement with Deendayal Port Authority (DPA) to develop Berth No 13 at Kandla, Gujarat. The 300m berth, with a capacity of 5.7 mmt, is set to be operational by FY27, expanding APSEZ’s presence at Deendayal Port and boosting service to Gujarat and north India.

Acquisition 

APSEZ has agreed to acquire an 80 per cent stake in Astro for $185 million, valuing the company at $235 million, and the existing promoters of Astro will hold the remaining 20 per cent stake. Founded in 2009, Astro is a global offshore support vessels (OSV) operator with a fleet of 26 vessels, providing services across the Middle East, India, Far East Asia, and Africa. The acquisition increases APSEZ’s fleet size to 168 vessels, expanding its presence in key regions and enhancing its Tier-1 customer base.

Building infrastructure   

As APSEZ aims to become India’s largest integrated transport utility company by 2030, it is strengthening its capabilities in all logistics segments (ports, CTO, warehousing, last-mile delivery, ICDs, etc.). Hence, it offers end-to-end service to its customers, thereby capturing a higher wallet share and making the cargo sticky in nature, the report stated. 

The company currently operates 12 multi-modal logistics parks (MMLPs), equipped with 131 trains, 2.9m sqft. of warehousing space, and 1.2 mmt of grain silos. It plans to expand its footprint and build a pan-India presence with logistic parks and warehouses.