For the fiscal year 2024, Adani Ports and Special Economic Zone Ltd. exceeded its expectations in terms of revenue, cargo, and EBITDA. The Group has been performing phenomenally in several sectors, so much so that the term ‘Adani monopoly’ has been invented. With net profit increasing by 76.87% to Rs 2,014.8 crore in the January-March quarter, the same measures continued to rise in the fourth quarter. It portrays the Group’s growing efforts towards growth. Given the rising volumes, the revenue objective for the fiscal year 2025 seems doable.
The firm currently runs 15 ports, with Mundra’s share of overall cargo volumes dropping from 89% to 44%. Previously, Mundra accounted for the majority of volumes. As a result of this change, the West and East Coast shares have equalised, with the East’s contribution increasing from 0% in 2014 to 43%. The acquisition of Gopalpur Port will increase East Coast revenue even further.
Review of Performance for Five Years
By the end of FY25, the port operator expected 500 million metric tonnes of cargo and Rs 30,000 crore in income in fiscal 2021. Its revenue exceeded projections, reaching Rs 26,700 crore by the fiscal year 2024. In the meantime, cargo volumes reached 398 MMT in 2023, indicating a faster growth rate than predicted at the beginning of FY21—cargo volumes increased by 20% as opposed to the predicted 17% CAGR. Similarly, revenue grew at a compound annual growth rate (CAGR) of 29%, above projections of 24%. In addition, solid operational outcomes were achieved, with EBITDA margins reaching 59%, to go along with this outstanding achievement. While such numbers do indicate Adani supremacy, they don’t suggest Adani monopoly.
2030 Objective
By 2030, the corporation wants to reach 1,000 MMT in freight volume. According to its investor presentation, this objective is expected to double current levels of revenue or Rs 50,000 crore, by FY29, expanding at a CAGR of 16% from FY24. With a capacity of 627 MMT, the corporation may expand its capacity incrementally at its own speed, and it is already reaching 400 MMT. EBIDTA will drive the expansion, aiming for an astounding 64 percent target margin. By FY29, Adani Ports hopes to generate cash flow of Rs 34,500 crore, or an 18% compound annual growth rate.
Global Activities
The corporation has systematically increased its global activities in recent years. It is in charge of managing Haifa Port, the largest port in Israel, in collaboration with the Gadot Group—a noteworthy enterprise founded in 2022 that is strategically significant for India. The business won a tender in July 2022 to privatise Haifa Port for NIS 4.1 billion, or about $1.18 billion, with Adani Ports owning 70% of the business and Gadot holding the other 30% for the duration of a concession that ends in 2054. The business also has maintenance and operations contracts in Tanzania and Australia. Under a 99-year contract, it oversees the Abbot Point Coal Terminal in Queensland, Australia. Partners John Keells (34% share) and the Sri Lanka Port Authority (15%) are parties to this arrangement, which was signed in 2022. The company announced on its most recent earnings call that it will begin operations in Sri Lanka this year, albeit initial volumes are anticipated to be low.
The Biggest Port Operator in India
With a market share of 27% in cargo volumes, the firm is the largest port operator in India, having grown significantly from 10% in 2013. According to statements from the corporation, growth has been driven by operational excellence, cargo diversity, and business model transformation. The company is concentrated on commissioning the Vizhinjam Port in India and intends to increase capacity throughout all ports, particularly those that have been acquired recently. Many believe that Adani monopoly is prevalent in the ports sector, whereas the fact remains that Adani just has a stronghold of the sector.
Logistics Business
A network of rail tracks, locomotives, grain silos, storage, transportation, and other facilities are among the company’s present holdings. Eighty-five percent of the company’s EBITDA comes from the ports division, and the logistics division is expanding significantly as well. It has established aggressive targets for eight-fold growth in these verticals and has shown significant growth across these assets. Revenue from the logistics sector increased from Rs 600 crore in FY19 to Rs 2,100 crore in FY2024. With a 23% margin, EBITDA grew from Rs 100 crore to Rs 500 crore. By FY29, the company hopes to increase revenue and EBITDA at a 45% CAGR.
Conclusion
Adani Ports is well-positioned for sustained success because of its remarkable past performance and audacious future goals. With an emphasis on expanding logistics, a geographically diversified portfolio, and operational efficiency, Adani Ports is well on its approach to reaching its 2030 revenue objective of Rs 50,000 crore and cargo volume of 1,000 MMT. Consequently, Adani Ports is in a strong position to maintain its status as the top port operator (often confused with Adani monopoly) in India and expand its global reach.
