Motilal Oswal Financial Services has renewed its buy recommendation on Adani Ports & SEZ, assigning a target price of Rs 1,820 from the current level of Rs 1,313 for almost 39% potential gain. This stance holds firm amid shipping disruptions from tensions near the Strait of Hormuz, where APSEZ's minimal exposure to liquid cargo limits risks. The brokerage points to container volume surges, logistics expansions, and marine service growth as drivers positioning the firm as India's leading integrated transport utility by 2029.
Shielded from Geopolitical Cargo Risks
APSEZ maintains structural protection against oil trade interruptions, with liquid cargo forming under 10% of total volumes. Crude oil represents only 5-6% recently, while gas stays at about 2%. Vessel rerouting and port congestion plague the sector, but APSEZ's diversified mix—bolstered by India's crude import reliance elsewhere—preserves throughput stability.
Container Strength Powers Volume Growth
Container volumes jumped 20% in the fourth quarter of FY26 through February and drove 14% overall growth then, alongside 11% for nine months. Coal volumes lagged from weak demand and facility issues, yet take-or-pay contracts secure profitability. APSEZ outpaced major ports at 8% growth and non-major ones at 3%, lifting its domestic market share to 26.4% and container share to 45.8% from 36% in 2020.
The network spans 15 domestic ports and terminals plus sites in Israel, Sri Lanka, Tanzania, and Australia, with 637 million metric tonne capacity. Haldia bulk terminal commissioning in March 2026 adds rail-linked efficiency, while Colombo automation and expansions at Dhamra and Vizhinjam fuel gains.
Logistics and Marine Segments Accelerate
Adani Logistics runs 12 parks, 132 trains, 3.1 million square feet of warehousing, and 1.3 million metric tonne grain silos. Investments of Rs 10-15 billion in FY26 and Rs 50 billion by FY30 target trucking via owned and third-party fleets for flexibility. This setup boosts customer retention and wallet share.
Marine operations, with 127 vessels post-Ocean Sparkle and Astro Offshore buys, saw Q3 FY26 revenue rise 91% year-on-year at over 55% EBITDA margins and 15% return on capital. Plans call for doubling revenue as a high-margin complement to ports.
Robust Projections Underpin Valuation
Projections show revenue climbing to Rs 369 billion in FY26E, Rs 440 billion in FY27E, and Rs 516 billion in FY28E, with EBITDA at Rs 221 billion, Rs 265 billion, and Rs 310 billion—holding 60% margins. Adjusted PAT grows from Rs 129 billion to Rs 202 billion, for 19% revenue and EBITDA CAGRs and 23% in PAT over FY25-28. Net debt-to-EBITDA falls from 2.1x to 0.9x, backed by Rs 118 billion cash.
At 23.5x FY26E P/E and 15.3x EV/EBITDA, the Rs 1,820 target applies 15x FY28E EV/EBITDA. Support lies at Rs 1,250 and Rs 1,200; resistance at Rs 1,450 and Rs 1,600. Port capacity builds, logistics integration, and marine scale cement long-term compounding.
