Gujarat Pipavav Port Limited (GPPL)

I was reading the annual report of GPPL and quite like the fundamentals and valuation of the business.
GPPL operates the Pipavav port in Gujarat and owned by APM Terminals (43% holding) (The Netherlands based MnC in port and terminal operation), the remaining holding is by marquee MF and FPI’s.
It’s in the business of Container shipment, Dry Bulk, LPG, and RoRo(Cars) EXIM.

I’m attaching the standalone Cash flow from the business in the past 6 years (Cr.).

Looking at the cash flows, the firm looks to be grossly undervalued, but here’s the catch.
The lease for the port that GPPL operates will expire in 2028.
Now my query is what will happen once the lease expires:

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Will the port be taken over by the Gujarat Maritime Authority, the real owner of the port?

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Will the lease be renewed? And if renewed, then at what rates?

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If the lease is not renewed then is it safe to assume the terminal value to be equal to the salvage value of whatever asset is left from the operation?

I tried searching a lot in the annual reports but it was in vain. Any help or light on this would really help me close on the valuation and enable me to make an informed investment decision.

P.S: I cannot find any thread on GPPL on the forum. If there already exist a topic under GPPL then my apologies, please merge it in the existing topic banner.


To add to this, I found one open source research from HDFC Securities from 2017 (they had a buy @150 BTW)

However, there is no mention of how they reached that buy target and what will happen post 2028 after the lease expire. This scenario was just not taken into account. The market cap of the firm has since then halved.