BW LPG Q1 FY25
Old news ,
Disc : Holding since the JV announced
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I never researched what was core business of BW LPG. Interesting that GB went with BW LPG as partner, who did not have any LPG infra experience or interests earlier. Just LPG trading and shipping experience. Maybe Gb thought this might negate any possibility of the partner being a threat, and will assist in LPG sourcing and shipping till JNPA. After that GB LPG terminal takes over for final LPG storage & confidence petroleum for distribution. 3 partners for 3 legs, wishful thinking it turned out to be stool, one gone all fell down.
Aegis on other hand ties up with Vopak (logn history of building terminals) for the capex heavy terminal setup part. But it retains the higher EBITDA last leg distribution business. Also sourcing and trading JV with Itochu is retained.
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One more interesting update from the company. Somehow it does not seem to end.
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No end to the soap opera, plus a mystery the stock jumps up today !!
Nice graphic summary, does this channel give similar views on all concalls ?
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Company has clarified that the “The JNPT land parcel remains a key
strategic asset. The Company has initiated construction of additional storage tanks to increase capacity by approx. 1,00,000 KL and plans to utilise the remaining land for ammonia and chemical storage, with a portion reserved for
future expansion of LPG, ammonia or liquid cargo facilities.”
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This is further to my last post on Ganesh Benzoplast, and important for ME, as I am taking U turn on my original thoughts.
I had initially written how I intend to stay away from the company due to its chequred past and all the recent negative developments, however, today I am with different views.
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While I was negative on under provisioning for Morgan case, the settlement looks to be a step in right direction. This frees management bandwidth in unproductive tasks and also allows the company to take corporate actions (demerger, dividends etc) whatever is appropriate.
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While I was negative on inability of company to make decision and move ahead with additional land parcel, my view today is that its not uncommon even for reputed companies to take too much time to decide and move ahead with huge Capex. The fact that company will have to stick to what it does with the land today, for next 25 years, makes me feel that investors can give extra time to the management, and changing plans about land usage should not be viewed too negatively
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The persistence of the management to appear in front of the investors in concalls, and answer difficult questions, despite everything wrong going in the company (theft by CEO, joint development falling apart etc), looks to be a good sign. Will this act continue, I am not sure.
So what is management attempting to do?
Trying to built market cap?
Building credibility in the market which has written off the company?
Is the phase of negative surprises over for the investors?
Has the character of the company changed?
Can the company be treated as investible?
Are there genuine efforts by the management in the right direction?
These are difficult questions to answers, and each investor will have different views, which makes investing interesting.
Disclosure - Tracking position. I am a amature investor, this post is not intended to influence anyone to buy/sell.
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Recent Updates -
Ganesh Benzoplast Limited (GBL) has recently faced a substantial increase in its land lease fees at the Jawaharlal Nehru Port Trust (JNPT) terminal. The annual lease rental provision for one of GBL’s older plots at JNPT surged from approximately ₹2–3 crore to ₹24 crore.
Capacity Expansion: The company is proceeding with a 1 lakh KL capacity expansion at JNPT, including the construction of 30,000 tons of A-class petroleum tanks. This is expected to generate high-margin revenue starting from FY27.
Price Adjustments: Management indicated they are seeking to demand a standard 4% to 5% year-over-year price escalation from customers and adjusting rental income to absorb the higher costs.
A 10x increase in a core operating cost is a “material event” that should have been disclosed via a standalone regulatory filing the moment the notice was received, rather than waiting for quarterly results. But then, corporate government was never this company’s strong suit.
Disc: Holding due to low valuations. Lost some capital over the course of the stock’s violent correction over the years.
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