Adani Ports: Sectoral leader's stock seen climbing 29% in a year, here's why

Shares of Adani Ports & SEZ (APSEZ) are likely to climb 29% in a year on the back of strong expansion plans. Brokerage Motilal Oswal cites strong cash flows, a healthy cash balance of Rs 16,900 crore  and net debt to EBITDA at 1.8 times as key factors driving growth for the  Adani Group firm. 

Adani Ports stock fell 1.85% to Rs 1315.50 on Tuesday against the previous close of Rs 1340.25 on BSE. Market cap of the firm stood at Rs 2.84 lakh crore on BSE. Total 0.45 lakh shares of the firm changed hands amounting to a turnover of Rs 5.93 crore. 

The firm has transformed from a traditional port operator into India's most diversified transport and logistics platform. Over the past decade, the company has consistently outpaced industry growth, with its domestic volume increasing nearly three times faster than the sector average, said Motilal Oswal. 

In the first quarter of FY26, APSEZ expanded its market share to 27.8%, reflecting a year-on-year increase of 60 basis points, while its container share rose to 46%. This growth is bolstered by new assets like Vizhinjam and Colombo, and overseas operations such as Haifa, further enhancing its geographic diversification.

The logistics division, anchored by Adani Logistics Ltd (ALL), has also experienced rapid growth. It has expanded across various segments, including container train operations, inland container depots (ICDs), warehouses, and trucking services. APSEZ operates 12 multi-modal logistics parks, 132 trains, 3.1 million square feet of warehousing space, and 1.2 million metric tonnes of grain silos.

This infrastructure provides comprehensive 'shore-to-door' solutions. The company plans significant capital investment into its trucking segment, with an allocation of INR 10-15 billion in FY26 and a total of INR 50 billion by FY30, under a hybrid model of owned and third-party trucks.

"We expect APSEZ to report 10% growth in cargo volumes over FY25-27. This would drive a CAGR of 16%/16%/21% in revenue/EBITDA/PAT over FY25-27. We reiterate our BUY rating with a TP of INR1,700 (premised on 16x FY27E EV/EBITDA)," said Motilal Oswal. 

These strategic expansions are designed to enhance the return on capital employed (RoCE) and position APSEZ as a leading player in the logistics sector. The company's focus on boosting its logistics capabilities through substantial investments aligns with its long-term growth strategy and further strengthens its foothold in the Indian transport and logistics industry. The developments underscore APSEZ's commitment to maintaining its leadership role while adapting to changing market dynamics and opportunities.