JSW Infrastructure Ltd shares fell about 6% early Friday, despite the company showing a 24% year-on-year increase in EBITDA. The drop in net profit was mainly due to foreign exchange adjustments, worrying investors.
Despite this, JSW Infrastructure is expected to keep growing thanks to more exports, higher demand for transportation, and benefits from recent acquisitions.
In the first quarter, the company’s volume grew by 9% year-on-year, despite a planned shutdown at JSW Steel’s Dolvi plant. Third-party cargo saw a strong growth of 48%, increasing its share of total cargo to 50% from 37%.
Building a steady base of non-captive customers is essential for the company, as relying heavily on captive customers poses risks. Higher handling charges from non-captive customers helped consolidated revenue grow by 20% to ₹1,109 crore.
After the results, analysts from Motilal Oswal Financial Services slightly reduced their adjusted profit after tax estimates by 4% for FY25 and 2% for FY26.
Future Growth Plans
JSW Infrastructure’s management predicts a 10-12% volume growth in FY25. The company currently has a cargo handling capacity of 170 million tonnes per year across two ports and eight terminals.
They plan to increase this capacity to 250 million tonnes per year by 2027 and 400 million tonnes per year by 2030 through expansions, acquisitions, and new developments. This includes a new port in Karnataka with a 30 million tonnes per year capacity, a project costing ₹4,200 crore, and new berths in Tuticorin and JNPT ports.
Recent acquisitions include a liquid handling terminal in the UAE and a port in Maharashtra, each with a capacity of 5 million tonnes per year. The company plans to invest ₹30,000 crore by FY30, including ₹13,000-14,000 crore in the next three years.
JSW Infrastructure also acquired a majority stake in Navkar Corp. Ltd for ₹1,644 crore, expanding into logistics. Navkar is a logistics service provider with a container train operator license, which had revenue of ₹435 crore in FY24.
JSW Infrastructure’s shares are currently trading at ₹315 each, up from its IPO issue price of ₹119 in October, boosted by acquisitions and government port development contracts.
However, the road ahead might be challenging. Analysts from Kotak Institutional Equities noted that JSW Infrastructure’s journey to becoming a complete logistics solution provider might take longer due to the lack of large, scalable assets in the market.
Investors seem optimistic about the company’s future, but much will depend on how quickly it can execute its ongoing projects.
Disclaimer: The views and investment tips expressed by investment experts on Sharepriceindia.com are their own and not those of the website or its management. Sharepriceindia.com advises users to check with certified experts before taking any investment decisions.
