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Essar Ports Ltd. Stock Analysis

Mid Cap
Evaluated by 457 users | BSE: 500630 | NSE: ESSARPORTS |
Shipping
Essar Ports earlier known as Essar Shipping Ports & Logistics (ESPLL) incorporated in 1975, is engaged in business of providing end-to-end logistics services with investments in ports and terminals, logistics services, sea transportation and oilfield drilling services.ent through a...

Analysis of Financial Track Record

Data adjusted to bonus, split, extra-ordinary income, rights issue and change in financial year end
Financial track record gives insight into the company's performance on key parameters over the past ten years. MoneyWorks4me’s proprietary colour codes make it easy for retail investors to gauge the company’s past performance.
Essar Ports Ltd. has not performed well majority of the past ten years indicating its past ten year financial track record is not good
Value Creation
 Mar'11Mar'12Mar'13Mar'14Mar'15Mar'16Mar'17Mar'18Mar'19Mar'20
Return on Capital Employed 1.17%-0.19%0.36%0.27%0.47%-0.13%-0.11%0.14%2.08%0.93%
Growth Parameters
Growth Parameters Colour Code Guide
Net Sales (Rs. Cr.) 48736.235.440.134.630.817.317.524.713.7
Y-o-Y Gr. Rt.--92.6%-2.3%13.4%-13.7%-11.2%-43.9%1.6%40.9%-44.5%
Adjusted EPS (Rs.) -1.17-1.73-0.91-0.65-0.06-3.1-10.29-0.56-0.410.4
Y-o-Y Gr. Rt.-NANANANANANANANANA
Book Value per Share (Rs.) 66.6263.8663.7462.4862.7358.9120.75174.82173.12175.16
Adjusted Net Profit -47.9-71-38.8-27.8-2.5-133-22-1.2-0.90.9
Net Op. Cash Flow (Rs. Cr.) 12412919313-225-2.827971.833.4-5.7
Debt to Cash Flow from Ops 5.955.723.2518.94-1.34-249.760.240.892.86-18.26
Standalone financials take only the parent company into account while consolidated financials take into account financials of the parent company as well as of all its subsidiaries. In most companies consolidated financials should be used for analysis.
Essar Ports Ltd. should be analysed on a Standalone basis
CAGR
CAGR Colour Code Guide
  9 yrs 5 yrs 3 yrs 1 yr
Net Sales -32.8%-16.9%-7.4%-44.5%
Adjusted EPS NANANANA
Book Value per Share 11.322.813.21.2
Share Price - - - -
Key Financial Parameter
Performance Ratio Colour Code Guide
 Mar'11Mar'12Mar'13Mar'14Mar'15Mar'16Mar'17Mar'18Mar'19Mar'20
Return on Equity (%) -0.96-2.65-1.45-1.03-0.09-5.09-1.58-0.38-0.240.23
Operating Profit Margin (%) 22.2535.058.4-30.1-50.579.03-27.99-18.91-9.5311.19
Net Profit Margin (%) -9.84-196.06-109.48-69.35-7.3-431.24-127.64-6.82-3.586.18
Debt to Equity 0.270.280.230.090.110.280.260.170.260.28
Working Capital Days 4781,0111,4551,4841,2151,3792,9312,5401,7754,353
Cash Conversion Cycle 31-82-166-131-220-375-27415-60-355
Entity Percentage Holding
Promoters 74.97%
Institutions 11.79%
Non-Institutions 13.24%
Pledged *99.7299.7299.7299.7299.7299.7299.7299.7299.7299.72
* Pledged shares as % of Promoter's holding (%)

MoneyWorks4Me analysed the past 10-year performance of Essar Ports Ltd. and arrived at the following conclusion:

Past 10 year's financial track record indicates that Essar Ports Ltd. is a below average quality company. However, for specific investment actions please connect with your investment advisor.

Data is not available for this company.

Data is not available for this company

Essar Ports earlier known as Essar Shipping Ports & Logistics (ESPLL) incorporated in 1975, is engaged in business of providing end-to-end logistics services with investments in ports and terminals, logistics services, sea transportation and oilfield drilling services.ent through a demerger process, following which the shipping, logistics and oilfield drilling businesses were demerged from ESPLL and transferred to another company, Essar Shipping Limited, which is also

Essar Ports earlier known as Essar Shipping Ports & Logistics (ESPLL) incorporated in 1975, is engaged in business of providing end-to-end logistics services with investments in ports and terminals, logistics services, sea transportation and oilfield drilling services.ent through a demerger process, following which the shipping, logistics and oilfield drilling businesses were demerged from ESPLL and transferred to another company, Essar Shipping Limited, which is also listed on Indian stock exchanges.

Essar Shipping Limited is a part of the multinational conglomerate Essar Group. The company has a port capacity of 76 MMTPA, which includes 46 MMTPA at Vadinar and 30 MMTPA at Hazira, making it India’s second-largest private-sector port company. The company has a clear vision for ongoing and under-development projects which will see ports capacity reaching 158 MMTPA by 2013.

Company provide its services to industries like oil and gas, steel and power generation. Currently, the company owns subsidiaries namely Essar Ports & Terminals, Mauritius (EPTL), Vadinar Oil Terminal, India, Essar Logistics, India, Essar Sisco Ship Management Company, India, Essar International, Guernsey (EIL). Company conducts its business activities through its subsidiaries. EIL owns subsidiaries namely Energy Transportation International, Bermuda. EPTL own subsidiaries namely Essar Bulk Terminal, India and Essar Bulk Terminal (Salaya), India. ESPLL’s fleet has a handling capacity of eight million barrels of crude oil, 320,000 barrels of petroleum products and 355,000 tonnes of dry bulk cargo.

Business area of the company

Ports and Terminals- ESPLL operates a crude oil and petroleum products terminal through Vadinar Oil Terminal (VOTL) located at Gujarat. VOTL encompasses product port, crude oil and petroleum product tankages, single point mooring, cross country and sub sea pipelines, and rail and road gantry. Its Single Point Mooring system is capable of handling crude capacity of up to 27 MMTPA. It also has marine facility for exporting petroleum products of up to 6.5 MMTPA.

Logistics- Essar Logistics (ELL) offers end-to-end logistics services ranging from ships to ports, lighterage services, delivery to plants, intra-plant logistics, and dispatch of finished products to the end consumer. Under this it owns 10 articulated barges, 2 floating cranes and 6 tugs. The company manages around 4,200 trucks (of which 38 owned) in order to offer inland transportation services to steel and petroleum industries.

Sea Transportation- Under this it offers transportation management services for crude oil and petroleum products, and dry bulk cargo to the global energy, steel and power industries. Currently this division owns 25 ships. 

Oilfields drilling- Essar Oilfields Services provides services such as onshore and offshore contract drilling, and offshore construction. Currently company possess semi - submersible offshore and twelve land rigs.

The ESPLL board, at its meeting held on August 12, 2010, unanimously passed a resolution to demerge its shipping, logistics & oilfields businesses into a separate entity. Under the scheme, ESPLL will transfer its Shipping, Logistics & Oilfields Services businesses to its existing wholly-owned subsidiary (‘resulting company’). In consideration, resulting company will issue one equity share of Rs 10 face value, each credited as fully paid-up to the shareholders of ESPLL, for every three equity shares they hold in ESPLL as of the record date.  In addition, the board has also approved a proposal for amalgamation of two of its wholly-owned investment subsidiaries into ESPLL, for simplification of the holding structure. On march 2011 it announced that it has received an order from the Gujarat High Court approving the scheme of arrangement for the demerger of its Shipping, Logistics & Oilfields Services businesses.

In may 2011, ESPLL in its Committee of Directors (Demerger Committee) meeting announced the completion of the demerger process. The committee fixed 19th May 2011 as the record date. ESPLL announced that the company has received all the approvals hence the completion of the process. The company also announced the new management structure for the two companies once they are listed on exchange. Post demerger, the present company will be split into two entities – Essar Ports Ltd and Essar Shipping Ltd. While the current company (ESPLL) will become Essar Ports Ltd, the Shipping, Logistics and Oilfield businesses will be spun off into a separate company called “Essar Shipping Ltd”.

The Share Capital will be split in a ratio of 2:1. For every 3 shares held of ESPLL, shareholders will get 2 shares of Essar Ports Ltd and 1 share of Essar Shipping Ltd. ESPLL, which has a share capital of Rs 615 crore, will start trading as Essar Ports with reduced capital of Rs 410 crore and the balance Rs 205 crore will form the share capital of Essar Shipping Ltd which will list subsequently. This reduction will take place after record date. Essar Shipping Ltd is expected to get listed separately around June end after completing the formalities of listing.

Accordingly the Scheme has become effective on May 09, 2011 and the transfer of the assets and liabilities of Essar Ports & terminals (EPTL) and Essar International Limited (EIL) shall stand vested unto the Company with effect from September 30, 2010 (the Amalgamation Appointed Date) and the transfer of the assets and liabilities of the Demerged Undertakings shall stand vested in Essar Shipping Limited with effect from October 01, 2010 (the Demerger Appointed Date).

The new management structure is as follows:Essar Ports Limited:Mr. Rajiv Agarwal will be the Managing Director of Essar Ports Limited. Mr. K.K. Sinha will be the CEO and Mr. Shailesh Sawa will be the CFO of Essar Ports Limited.

Essar Shipping Limited:Mr. A. R. Ramakrishnan will be the Managing Director of Essar Shipping Limited once it is listed. The company will include the Sea transportation business, Oilfield services business and the Logistics business. Capt. Anoop Sharma will be the CEO of the Sea Transportation business, Mr. Ankur Gupta will be the CEO of the Oilfields business, Mr. Rahul Himatsingka will be the CEO of the Logistics business and Mr. Vikram Gupta will be the CFO of Essar Shipping Limited.

Ports businessThe Ports company will be second largest private sector port company in India with 88 MTPA of current capacity, with a target to reach 158 MTPA by 2013. The existing port capacity of 88 MMTPA includes 58 MMTPA at Vadinar and 30 MMTPA at Hazira. The company has a clear vision for ongoing and under development projects which will see ports capacity reaching 158 MMTPA by 2013. The company has committed Rs 9,300 crore towards this business, of which Rs 6,150 crore has already been invested.

Most of the current capacity and a sizeable portion of the proposed capacity are backed by long-term take or pay contracts, which not only ensures sustained capacity utilization, but also gives very good visibility on future earnings.

Shipping, Logistics & Oilfields Services businesses

Essar Shipping Limited will be the second largest Shipping and Oilfields Services Company in the private sector. The Shipping business has a diversified fleet of 26 vessels, including VLCCs, capesizes, Supramaxes, mini bulk carriers and tugs. The company has placed orders for 12 new ships, which are expected to join the fleet over the next 24 months. A sizeable part of the capacity is deployed on long-term contracts and COAs, insulating the company from the volatility of spot markets.

The Oilfields Services business provides contract drilling services to oil & gas companies across the globe. This business owns one semi-submersible rig and 12 land rigs. The company has ordered two new jack-up rigs, which will be joining the fleet over the next 18 months.

The Logistics business provides end-to-end logistics services - from ships to ports, lighterage services to plants, intra-plant logistics and dispatching finished products to the final customer. This business owns transshipment assets to provide lighterage support services, and onshore & offshore logistics services. It manages a fleet of over 5,000 trucks for inland transportation of steel and petroleum products.

The company has booked twelve new ships, including six Minicapes (105,000 DWT each) and six Supramax dry bulk carriers (54,000 DWT each). They are expected to join the fleet in a phased manner by FY13.

Awards/ Recognition

  • 2013
    Lloyd's list awards middle East & Indian Subcontinemt 2013 Winner Safety award
    2012
    Gold Achievement Award in Occupation Health & Safety from The Royal Society for the Prevention of Accidents
    Environment Protection Award in India Shipping Summit, Mumbai
    Awarded Gold award at the RoSPA Occupational Health and Safety Awards 2012 for prevention of accidents and ill health
    Gujarat Star Award for Port/Terminal of the Year (Health Safety & Environment)
    Best Coal Port Award by IHS Mccloskey mjunction
    Grrentech Safety Award 2012 By Greentech Foundation
    Health & Safety Award by Gujarat Junction Award
    L&T Appreciation Letter
    Appreciation by Agarwal Coal
    Appreciation by Bhatia Coal
  • 2011
    Winner of Greentech Safety Award, in GOLD Category
    Certified by ABS for ISO 28000:2007 for Security Management Systems
    2010
    British Safety Council 5 Star rating in the Environmental Management System
    Terminal Certified by ABS for OCIMF Base Line Criteria
  • Company’s subsidiary Vadinar Oil Terminal has received the British Safety Council 5 star rating for maintaining excellent occupational health, safety and environment.
  • ESPLL received Most Quality Conscious Shipping Company award from the Directorate-General of Shipping.
  • VOTL’s Single Point Mooring (SPM) system was awarded the Certification of Class from the American Bureau of Shipping becoming first Indian company to receive this recognition.
  • In 1993, ESPLL was the first Indian company to receive ISO certifications from Lloyds Register of Shipping.
Puchho Befikar
SEBI Registered: Investment Adviser - INA000013323
Research Analyst - INH000000719

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