Aegis Logistics had flat results for Q2 2016 were absolutely flat, even with a 36% rise in revenue. They saw reduced profitability from their liquid terminal division, while the gas division saw a new 40% jump in profit.
The presentation has some interesting stats:
Greenfield expansion at Haldia for gas and debottlenecking in Mumbai will triple throughput in the next year.
This will also double their storage capacity, nearly (but they get paid for throughput, not capacity)
They have done very well with Gas in H1, with 31% increase in EBIDTA and a 28% higher volume of gas carried.
They also have liquid logistics coming up in Mangalore and Kandla, and some expansion in Haldia, all set for next year. That would indicate a 30% increase in capacity.
LPG usage in India is set to move up as more people get LPG through the government expansion drive and the fact that there is no or low subsidy now.
The relatively lower price of crude means that Indian usage is likely to continue to grow, which means more business for liquid/gas logistic players like Aegis.
We don’t expect the stock to outperform till this capacity expansion is completed.
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