Release Date: July 31, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Aegis Logistics Ltd (BOM:500003, Financial) achieved a record-breaking Q1 FY25 with the highest ever volumes, EBITDA, profit before tax, and profit after tax in both gas and liquid divisions.
- The company reported an EBITDA of INR250 crores, marking an 18% increase compared to the same quarter last year.
- Profit after tax increased by 19% to INR158 crores in Q1 FY25, driven by continued growth in volumes at the Kandla terminal and full utilization of newly commissioned tanks.
- Aegis Logistics Ltd (BOM:500003) is on track to achieve a 25% CAGR over the next three years, supported by new capacity from greenfield and brownfield expansions.
- The company is committed to sustainable energy infrastructure, with plans to commence construction of its first ammonia terminal in Gujarat during this fiscal year.
Negative Points
- The distribution segment saw a decline in volumes, handling 129,000 metric tonnes in Q1 FY25 compared to 159,000 metric tonnes in Q1 FY24.
- Sourcing volumes also decreased, with sales volume of the sourcing business at 124,000 metric tonnes in Q1 FY25 versus 226,000 metric tonnes in the same quarter last year.
- The financial position, while robust, shows a reliance on continued capital expenditure, with nearly 50% of the INR4,500 crores CapEx program still in progress.
- There are concerns about potential competition from new LPG terminals at JNPT, which could impact volumes at existing ports.
- The company faces uncertainties related to the completion and commissioning of ongoing projects, such as the Kandla-Gorakhpur pipeline and the Mangalore LPG terminal.
Q & A Highlights
Q: What is the reason for the distribution segment getting impacted?
A: The distribution segment has not performed badly compared to Q4. Q1 is typically the lowest quarter of the year. Natural gas prices were reduced by Gujarat Gas, which has since reversed. Despite lower volumes, EBITDA realizations were strong, indicating better performance compared to Q1 of last year. - Murad Moledina, CFO
Q: Can you provide more details on the new Mumbai port terminal?
A: The new terminal in Mumbai will have a capacity of 150,000 kiloliters with an estimated project cost of INR250 crores. More details will be provided in the next quarter. - Murad Moledina, CFO
Q: What are the future opportunities beyond the INR4,500 crores CapEx plan?
A: The pace of capital spending is expected to continue beyond FY27 due to a robust pipeline of projects. Opportunities are frequently arising, and we are confident about the long-term growth plan. - Murad Moledina, CFO and Raj Chandaria, Chairman and Managing Director
Q: What is the expected timeline and market reach for the Mangalore expansion?
A: The Mangalore cryogenic terminal is expected to be operational by Q1 FY26. It will serve markets within a 300-500 km radius and potentially connect to the Mangalore-Hassan-Cherlapally LPG pipeline, serving a broader region. - Murad Moledina, CFO
Q: Can you clarify the discrepancy between national LPG import growth and Aegis' terminal growth?
A: The MoPNG data does not capture private imports. Our throughput volumes are expected to grow at a healthy rate of over 25% annually. - Murad Moledina, CFO
Q: What is the status of the ammonia terminal in Gopalpur, Orissa?
A: The ammonia terminal in Gopalpur is still in the exploratory stage. Nothing has been finalized yet. - Murad Moledina, CFO
Q: How will the new LPG terminal at JNPT affect Aegis' volumes at Mumbai port?
A: LPG demand is growing at 5-7% CAGR annually. We have the necessary skill sets and infrastructure to remain competitive. We do not expect any significant impact on our throughput volumes. - Murad Moledina, CFO
Q: What is the USP of Aegis' Mangalore terminal compared to existing competitors?
A: The Mangalore terminal will have an 82,000 metric tonne cryogenic capacity, allowing for efficient unloading of VLGCs. This will significantly reduce logistics costs for customers. - Murad Moledina, CFO and Raj Chandaria, Chairman and Managing Director
Q: Can you provide a breakdown of financials between the JV and Aegis' listed company?
A: The annual report provides detailed financial breakdowns. The stand-alone profit includes INR180 crores realized from selling preference shares to Royal Vopak, which is not reflected in the consolidated profit due to Indian accounting standards. - Murad Moledina, CFO
Q: How should we expect distribution volumes to shape up for FY25?
A: We expect to grow between 25-30% year-on-year, with a potential step-up next year when new cryogenic terminals are commissioned. - Murad Moledina, CFO
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
