Buy Gujarat Pipavav Port; target of Rs 160: Edelweiss

Edelweiss’s research report on Gujarat Pipavav Port

Gujarat Pipavav Ports (GPPV) Q4FY18 EBITDA was 10% below our and consensus estimates impacted by pricing pressures and high dredging cost. Key highlights: 1) GPPV reported 19% QoQ growth in container volumes following two line additions, higher trans-shipment and coastal volumes; 2) management indicated volume traction is sustainable (targeting 0.8mn TEUs in FY19) with full ramp up of existing services and likely addition of new service.


We believe that pricing pressure is likely to persist in ensuing quarters, and upcoming volume recovery should boost revenues. At CMP, the stock trades at reasonable 14x and 11x EV/EBITDA on FY19E and F20E earnings, respectively. We maintain BUY with SoTP-based target price of INR160.

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