Gujarat Pipavav Port share price dipped 6.14% to Rs 136 on NSE, trading at its new 52-week low. Since November 3, post July – September 2016 (Q2FY17) results, the stock underperformed the market by declining 18% as compared to 3.7% decline in the S&P BSE Sensex and 4.39% decline in Nifty50 Index.
The company had posted 32% year on year drop in net profit at Rs 59.4 crore in Q2FY17 as compared to Rs 87.5 crore in Q2FY16. Total income from operation went up by 16% at Rs 172 crore on the yearly basis. EBITDA (earnings before interest, taxes, depreciation, and amortization) increased 29% Year on Year at Rs 100 crore, below analyst estimate on weaker than expected container volume growth. On sequential basis, EBITDA margin slipped to 57.3% in Q2FY17 from 59.9% in Q1FY17. Lower reefer volumes and higher bulk volumes at lower margins led to decline in EBITDA margins.
Meanwhile, Gujarat Pipavav share price closed at Rs. 137.35.
The subdued volume growth was because of lower than expected reefer volumes and loss of 3.3k TEUs on account of closure of Hanjin operations. The management said that the loss of volumes from its two key customers– Hanjin which filed for bankruptcy and Hyundai which discontinued the operations will result in an annual loss of 80-90k TEUs (10-13% of volumes).
Although the near term volume growth remains submissive given weak trade activity and loss of business, analysts remains positive on GPPV given its strategic location, adequate capacity and seamless access to rail line which should place it favorably during an up-cycle. The focus will remain on Gujarat Pipapav’s ability to drive volumes in a weak EXIM trade environment, competition from peers such as Mundra and Hazira Port and upcoming capacity at JNPT Port.
Today, Gujarat Pipavav also declared a dividend of Rs. 2 on each share of face value Rs. 10.
It is recommended as the top 500 performing stock for the quarter by Dynamic Levels. For the resistance and support levels of Gujarat Pipavav, visit Gujarat Pipavav share price forecast page of Dynamic Levels website.
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