State-owned Container Corporation of India (CONCOR) is confident of achieving volume growth of 10-12% in the current financial year (FY24). This is despite volumes growing at only around 7.2% in the first nine months of the year.
Sanjay Swarup, Chairman and Managing Director said the company has been able to retain customers despite the relatively expensive services.
He expects earnings before interest, tax, depreciation, and amortisation (EBITDA) margin to sustain around 24-25%. In a post-earnings call with CNBC-TV18, he said CONCOR has consciously decided not to pick up low margin business.
The company's EBITDA margin was at 23.4% in the third quarter versus 21.6% in the year-ago period. Its revenue from operations increased 10.3% year-on-year (YoY) to ₹2,210.6 crore from ₹2,004.5 crore last year. Net profit rose 12.7% YoY to ₹330.6 crore.
Swarup sees robust demand with good visibility on exports in the next financial year (FY25). The export-import (EXIM) segment volumes are expected to grow at 10-12% this year.
Domestic volumes for the company grew 1.25% in Q3 and 10.88% in the first nine months of the year (9MFY24). EXIM segment volumes grew 8.25% in Q3 and 6.2% in 9MFY24.
The CONCOR board also declared a third interim dividend of 80% or ₹4 per equity share of face value of ₹5 each amounting to ₹243.72 crore. The record date for payment of interim dividend is February 7, 2024.
Brokerage firm Jefferies has a Buy rating on CONCOR with a target price of ₹1,101 per share. In a note, Jeffries said price hikes taken by the company impacted domestic volumes and delayed surcharge pass through to customers impacted its export-import (EXIM) margins. However, the fourth quarter should see EXIM margin recovery.
Shares of the New-Delhi based CONCOR have gained nearly 32% over the past year. The company's market capitalisation is around ₹50,100 crore.
(Edited by : Shweta Mungre)
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