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Essar Ports (Standard Chartered) update.2011.Jun.29 |
| Date | Rating | Target Price | Recommendation Price | Broker house | | 29 Jun 2011 | outperform;(Initiation) | 190 | 106 | Standard Chartered Report | |
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Essar Ports (Citi) Initiate at Buy: Dropping Anchor to Unlock Value |
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Initiate at Buy/Medium Risk;DCF-based TP of Rs133;Part of US$15bn Essar group;Growth in third party cargo to reduce concentration risk;Cargo to be 2.6x by FY14E; PAT to grow ~11.5x by FY14E | Date | Rating | Target Price | Recommendation Price | Broker house | | 20 Jun 2011 | buy;(Initiation) | 133 | 106 | Citi Report | |
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Essar Ports (Deutsche Bank) On track to develop a resilient business; initiating with Hold |
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Scalable unique business, but target price offers limited near-term upside;One of the few groups in port assets, giving early mover advantage;Strong operating cash flow growth, but need to reduce leverage;Our NPV-based target price of INR117 implies exit P/B book of 2.2x | Date | Rating | Target Price | Recommendation Price | Broker house | | 17 Jun 2011 | hold;(Initiation) | 117 | 106 | Deutsche Bank Report | |
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Essar Ports (ICICIsecurities) Re-rating on the cards |
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Essar Shipping Ports and Logistics Ltd (ESPLL) has demerged its sea transport, surface transport and oilfield services business into Essar Shipping Ltd. The existing company would operate only the port business and be renamed as Essar Ports Ltd (EPL). |
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Essar Ports (JP Morgan) Port of Promise |
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Essar Ports is India's second-largest private sector port operator;Promise to ‘take or pay’;Essar Ports is trading at 9.0x FY13E EV/EBITDA, a 33% discount to MPSEZ | Date | Rating | Target Price | Recommendation Price | Broker house | | 1 Jun 2011 | overweight;(Initiation) | 135 (from --) | 124 | JP Morgan Report | |
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Essar Shipping and Ports Demerger |
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Essar Shipping & Ports (ESPLL) is demerged into 2 companies Essar Shipping and Essar Ports. ESPLL last closing price is Rs 94.87 (as on May 17).
Essar Shipping & Ports (ESPLL) share capital has been split in the ratio of 2:1. For every 3 shares held of ESPLL, shareholders have received 2 shares of Essar Ports and 1 share of Essar Shipping.
Earlier three shares of ESPLL were valued at Rs 284.61 (3 shares * Rs 94.87 closing price of ESPLL on May 17) and now two shares of Essar Ports valued at Rs 242.7 (2 * Rs 121.35 closing price of Essar Ports). Break even point for an investor comes to Rs 41.91 (Rs 284.61 – Rs 242.7) which means that investors holding shares of ESPLL will make profit when Essar Shipping (the resultant company), will list above Rs 42. Essar Shipping is likely to list in July.
The existing Essar Ports capacity includes 58 MMTPA cargo handling capacity at Vadinar port and 30 MMTPA at Hazira port. The utilization in FY 2010-11 was 40 million tonnes, with ports contributing revenues of Rs 732 crore and EBITDA of Rs 534 crore.
With ESPLL successfully demerging and trading as Essar Ports, the share capital of the company has therefore reduced from 61.5 crore shares to 41 crore shares. Remaining 20.5 crore shares are with Essar Shipping. |
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