Aegis Logistics - Can It Be Exception?

Collaborators Corner
102

Aegis had another good quarter and a very good full FY24, with FY24 EBITDA growing by 25% and EPS by 23%. They finally announced their ammonia expansion which should deliver 120 cr. EBITDA at full utilization and require 500 cr. investment. They are confident of growing terminaling volumes to 5mn MT in FY25 (vs 4.1 mn MT in FY24) and distribution volumes by 25-30%. Concall notes below.

FY24Q4 concall

  • Pipavav
    • 45,000 MTPA capacity will be commercialized by Q1FY26 (around the same time as KGPL pipeline)
    • Recently commissioned LPG bottling plant
  • Haldia : Added 50,000 kl of liquid capacity
  • Kandla :
    • Commissioned 35,000 KL of liquid tanks, taking total capacity to 970,000 MT. Additionally constructing 25,000 KL which will be operational next year
  • Mangalore:
    • Following these expansions, total liquid capacity at Mangalore will reach 154,000 KL and are constructing an additional 71,000 KL in liquids that will be operational in the next 12 to 15 months
  • Kochi : Acquired 16,000 kl liquid capacity and expanding by 25,000 kl
  • JNPT : will be commissioned in 2024
  • Terminaling:
    • EBITDA/ton was 1100 EBITDA/ton (vs 1000/ton earlier) due to procurement efficiencies which they get as they handle more gas volumes. Expect this improvement to continue
    • Expect 5mn MT volume s in FY25
    • Current price differential between LPG and LNG is 7-10%
  • Distribution
    • EBITDA/ton was 4500-5000 (normal margins should be around 3000/tons)
    • Expect large growth in distribution business as Mangalore and Pipavav come onstream in FY26
    • 40-50% of Morbi volumes are now LPG
    • Expect 25-30% volume growth
  • Sourcing volumes: 798,400 MT vs 895,300 in FY23
  • Liquid
    • Capacity was 1.9 mn kl and will increase by 300,000 kl in FY25, operated at 87% utilization
    • Revenue growth was higher than volume because of some take-or-pay contracts
    • Liquid contracts are 1-year and they generate 3000/CBM
  • Ammonia:
    • Will start construction of first terminal in Pipavav (36,000 MT capacity) which can result in throughput of 3x a month and 1.2-1.3 mn MT in a year at optimum utilization - 500 cr. investment
    • Expect 3x turns, 1.2 mn MT volumes at peak utilization with 1000/ton EBITDA (i.e. 120 cr. EBITDA at peak utilization i.e. 3x asset turns). Expect slightly under 1000/ton EBITDA
    • Can handle any kind of ammonia (gray/blue/green)
    • Currently most users have their own terminals

Disclosure: Invested (position size here, sold shares in last-30 days)

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