Hello,
I have written a stock story:
Kesar Terminals and Infrastructure Ltd.
Cmp: 362.90 Market cap: 190.64 cr.
Background:
Company was incorporated on 21th jan 2008 as a wholly owned subsidiary of Kesar enterprise ltd.
The company has subsidiary Kesar multimodal Logistics ltd which has expanded into logistics and is developing a composite logistics Hub at Pawarkheda, Madhya Pradesh which includes facilities like Private freight Terminal (Rail Terminal), Warehousing and storage terminals, container freight station and cold storage warehouses.
According to latest update dated 29/2/2016, the company has 88.3 acres of land which includes the development of an entire range of infrastructure, rail sliding for cargo and container movement, rail side warehouses, inland container depot, cold storage, food grain warehouse and development of common facilities for putting up agri-processing units.
Core business:
A.) the company’s business is like renting liquid storage facilities to importers and exporters near Kandla port
B.) They also have inland container depot for cargo and container movement, railway terminal and storage for cold chain and food processing cold storage, warehouses, agro based industries value addition service, truck terminal.
C.) Traders of fruits, vegetables and other horticulture produce will have facility of cold storage of 40,000 quintals in the Madhya Pradesh hub.
Bullish viewpoints:
a. Company specific:
According to latest notification, the terminal can now be considered as an operational and it would be developed in 2 phases out of which 1st phase has now become operational.
The company currently operates 2 bulk liquid chemical terminals at Kandla, Gujarat having a combined capacity of 127000 Kilo Litres with a total tank of 64 tanks which includes specialized tanks, such as stainless steel tanks, tanks equipped with heating and insulation facilities and coated tanks which stores speciality products
The company has about 10 acres of land on long-term lease basis at Kakinada port in Andra Pradesh. The company plans to put up both dry cargo warehousing and bulk liquid terminals facilities.
GST passing would be again a boost for Kesar Terminals and Infrastructure
b. Industry specific
The Govt. t’s thrust towards domestic manufacturing is expected to redefine the product flow pattern, increasing volumes will lead to shift from containized movement to bulk movement which creates a huge opportunity for liquid bulk handling at Indian ports
There are in total 13 major ports and 200 non-major ports comprising almost 55% of country’s trade volume. There is a huge transmission from handling typical break and bulk type cargoes to handle specialised cargoes like liquefied Natural Gas and hazardous chemicals due to this inefficiency there is huge opportunity in this segment.
The industry has high entry barriers due to high investment cost in land near ports, constructions and govt. approvals regarding high hazardous chemical storage.
Bearish viewpoints:
Long term borrowings are now 89 cr, of this 11 cr for terminal business and Rs 75.44 cr for Kesar Multi Modal ltd. business at the rate of 11 % to 13.25% p. a. which are payable in 16 to 28 quarterly equal instalments starting after the moratorium period ranging from two to three years from the date of first disbursement of the respective loan.
Capacity constrains
Lack of adequate infrastructure
Revenues are concentrated from kandla port
Any regulatory restrictions may affect the company as well as industry.
Share-holding pattern:
Promoters 59.92%
Corporate 5.74%
Public 27.47%
Fii 0.02%
Dii 4.9%
Others 1.95%
Market cap Free float 76.25
Valuation:
IN CRORES
Mar-15 Mar-14 Mar-13
SALES 42.26 36.24 29.85
SALES% 16.61 21.41 -
EBITDA 25.51 21.64 17.49
EBITDA% 60.36 59.71 58.59
NET PROFIT 14.51 11.00 8.39
NETPROFIT MARGIN 34.34 30.35 28.11
NET PROGIT GROWTH 31.11 31.91 -
EPS 27.61 20.95 15.98
DIVIDEND 3.50 1.50 4.50
Feedback please