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Adani Ports & SEZs (APSEZ) Mundra port maintains its impressive growth,with newer assets gaining scale and expected to contribute 35% of consolidatedcargo by FY16E. Driven by the incremental volumes, we estimate a 24% CAGR incargo handled for APSEZ (174m tonnes in FY16E) and a strong 24% earningsCAGR over FY14-16. The healthy growth profile, coupled with a robust balancesheet, makes APSEZ our preferred infra play. Also, the SEZ business is likely toemerge as a key value creator given the increasing challenges to land acquisitionin the country. We reiterate Outperformer on APSEZ with a DCF-based target

price of Rs235.Mundra stellar performance continues: Mundra Port handled 100m tonnes ofcargo in FY14, which makes it the largest commercial port in India. Mundras long-term contracts for coal and crude cargo, along with sustained market share gains incontainers, have led to a volume surge of 23% CAGR over the past five years.

Newer assets gaining prominence: CT-3 and Dahej Port have registeredimpressive growth and are highly profitable. Hazira Port too is well-positioned toscale up in the next two years, benefiting from a highly industrialized hinterland.While Mormugao and Vizag are already under trial runs, Kandla would commenceoperations by end-FY15. We expect a 24% CAGR for APSEZ in consolidated cargoover FY14-16 (174m tonnes in FY16) with a 35% cargo share of newer assets.

Our preferred infra play: APSEZ offers a strong growth profile with 24% earningsCAGR over FY14-16E and robust balance sheet. The SEZ business, with ~16,000acres of land bank, is likely to emerge as a key value creator in view of increasingchallenges on land acquisition for industries. We reiterate Outperformer on APSEZwith a DCF-based 12-month price target of Rs235. Key risks include a prolongedslowdown in the economy and overcapacity in container handling.

Key valuation metrics

As on 31 March FY12 FY13 FY14E FY15E FY16ENet sales (Rs m) 26,973 35,766 44,453 58,405 73,718

Adj. net profit (Rs m) 11,947 15,904 18,115 22,551 27,655

Shares in issue (m) 2,003 2,003 2,070 2,070 2,070 Adj. EPS (Rs) 6.0 7.9 8.8 10.9 13.4

% change 42.4 33.1 10.2 24.5 22.6PE (x) 31.2 23.4 21.2 17.1 13.9Price/ Book (x) 7.5 5.7 4.3 3.5 2.8EV/ EBITDA (x) 30.8 20.3 17.5 12.9 9.8RoE (%) 25.9 27.7 23.3 22.5 22.6RoCE (%) 8.5 8.9 10.0 11.9 13.6

INSTITUTIONAL SECURITIES

INDIA RESEARCH

Adani Ports & SEZGood t o great

Shirish [email protected]

91-22-6622 2575For Private Circulation only.

Important disclosures appear at the back of this reportSEBI Registration Nos.: INB23 12914 37, INF23 12914 37, INB01 12914 33, INF01 12914 33.

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M ay-13 J ul- 13 Sep- 13 N o v-13 J an-14 M ar-14 M ay- 14

Adani Po rt & Special Econom ic Zone Sensex

Price performance relative and absolute

Ashish [email protected]

91-22-6622 2560

5 May 2014

BSE Sensex: 22404

Sector: Ports

Stock data

CMP (Rs) 186Mkt Cap (Rsbn/USDbn) 384.7 /6.4

Target Price (Rs) 235Change in TP (%) +29 Potential from CMP (%) +27

Earnings change (%)FY14EFY15E 5.4FY16E 11.4

Bloomberg code ADSEZ IN1-yr high/low (Rs) 213/117

6-mth avg. daily volumes (m) 2.816-mth avg. daily traded value(Rs m/US$ m) 482.7 / 8.02

Shares outstanding (m) 2070Free float (%) 25.0Promoter holding (%) 75.0Stock price as on 2 May 2014

(%) 3-mth 6-mth 1-yr

Adani Port & SEZ 26.5 28.3 27.0BSE Sensex 9.2 5.7 14.9

O U TP R O RM R

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2 | IDFC SECURITIES 5 May 2014

Mundra achieves pole position

Having handled 100m tonnes cargo in FY14, Mundra Port (Mundra) has become the largest commercial port in thecountry. Mundras geographical advantage, along with its superior handling and evacuation infrastructure, has beenthe backbone of this rapid growth (23% CAGR in the last five years). Mundras long-term contracts for coal and crude

provide strong visibility on cargo growth. Market share gains and commencement of trans-shipment have also led to arapid scale-up in container cargo at Mundra. We expect a 13% CAGR in cargo at the port over FY14-16.

Mundra becomes Indias largest commercial portMundra handled 100m tonnes of cargo in FY14, becoming Indias largest commercial port. The port has rapidly gainedscale, growing at 23% CAGR over the past five years as compared to ~7% CAGR for Indias overall port cargo. Duringthe period, Mundras market share too has doubled to 10%. Mundra has a total cargo handling capacity of 200mtonnes.

Capacity matrix

Capacity matrix Units Mundra Dahej Hazira Mormugao Vizag Kandla Ennor e Total Group

Bulk mt pa 100 20 15 10* 7* - - 152Crude mt pa 50 - - - - - - 50Containers m TEUs 4 - 2 - - - - 6Current capacity mt pa 200 20 35 10 7 - - 272

Under developmentLNG mt pa 5 - - - - - - 5Bulk (coal terminal expansion) mt pa 40 5 - - - 20 - 65Containers m TEUs - - - - - - 1.4 1.4Total under development mt pa 45 5 - - - 20 18 88

Expanded capacity mt pa 245 25 35 10 7 20 18 359Source: Company data * -under trial runs to be commissioned by Jul/Aug-14

Long-term contracts for crude and coal cargo enhance volume visibilityCoal, crude and container cargo have been the key drivers of Mundras strong cargo growth. Mundra has long-termcontracts for crude cargo with IOC and HPCL-Mittal Energy, and for coal cargo with Mundra UMPP and AdaniPowers Mundra Power project. We estimate Mundra to have handled 27m tonnes coal and 18m tonnes crude underthese long-term coal contracts in FY14. Coal cargo has been further aided by an overall surge in Indias imported coalvolumes to ~175m tonnes in FY14 (~36% CAGR in the past three years).

Market share gains and trans-shipment driving container volumesWith total container handling capacity of 4m TEUs, Mundra has become the largest container port on the West Coastand had a cargo market share of 31% in CY13. Its volumes have registered 23% CAGR over the past three years (basedon our FY14E estimate of 2.3m TEUs) as compared to ~5.5% CAGR for the industry. This rapid market scale-up has

been on the back of Mundras good cargo handling and evacuation infrastructure. Volumes have also been aided by

commencement of trans-shipment at Mundras new container terminal, CT-3.




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West Coast cont ainer market

In '000 TEUs CY09 CY10 CY11 CY12 CY13Major Ports 4,036 4,543 4,535 4,434 4,228Growth (%) (8.8) 12.6 (0.2) (2.2) (4.6)Market share (%) 77 74 69 66 60

Mundra 867 1,170 1,403 1,683 2,159Growth (%) 5.2 35.0 19.9 20.0 28.3Market share (%) 17 19 21 25 31GPPL 321 466 610 570 661Growth (%) 64.4 45.0 30.9 (6.5) 15.8Market share (%) 6 8 9 9 9Minor Ports 1,188 1,636 2,013 2,253 2,820Growth (%) 16.5 37.7 23.0 11.9 25.1Market share (%) 23 26 31 34 40Total West coast 5,224 6,179 6,548 6,688 7,048Growth (%) (4.0) 18.3 6.0 2.1 5.4Source: Company data, Indian Ports Association

We expect 13% CAGR for cargo at Mundra over FY14-16EWe estimate cargo at Mundra to increase to 128m tonnes by FY16 (from ~100m tonnes in FY14) with 30% ofincremental cargo likely to come from its long-term contracts for coal and crude. Container cargo, aided by furtherramp-up in volumes at CT-3, is likely to constitute 50% of the incremental cargo at Mundra.

New ventures acquiring scale

APSEZs new ventures have been rapidly acquiring scale, giving the company continued growth visibility even as theparent business at Mundra matures. CT-3, in its first full year of operations (FY14), achieved ~40% capacity utilization,led by both EXIM and trans-shipment cargo. The Dahej Port is also operating at ~40% capacity and is highly profitable.Cargo at Hazira Port is picking up pace; we estimate volumes of ~4m tonnes in FY14. We expect 81% CAGR in cargo

from new ventures (non-standalone cargo) over FY14-16 and account for 35% of consolidated cargo volumes.

CT-3 off to a flying startAPSEZ set up its third container terminal (CT-3) in the South Basin at Mundra at an investment of ~Rs20bn. Theterminal has a capacity of 1.5m TEUs and has been set up in a 50: 50 JV with MSC. MSC is among the largest shippinglines in the world and carried 13.2m TEUs globally in 2012. MSC will make CT-3 its India hub, which will enable aquick ramp-up in volumes at this terminal. APSEZ, besides having a 50% equity stake in the terminal, will also earn a20% share of cargo handling revenues and 100% of marine revenues. CT-3 handled 0.45m TEUs during April-Dec2013; we estimate 0.6m TEUs in FY14. About 40% of these volumes are likely to be trans-shipment. The companyexpects this proportion to rise to ~50% in the next 1-2 years.

Dahej port scaling up well; posts robust profitabilityDahej Port (20m tonnes; South Gujarat) was commissioned in January 2012 and has seen a quick ramp-up in cargovolumes. The port handled 6.4m tonnes cargo during April-Dec 2013; we estimate cargo volumes of 8m tonnes forFY14. Nearly 80% of the cargo handled comprises coal for power producers based in Gujarat, Rajasthan, MadhyaPradesh and the NCR (National Capital Region). Dahej also handles bulk cargo for various fertilizer companies andindustrial users based in South Gujarat. The port has signed eight medium-term cargo contracts with many users,including GSFC, GNFC, Saint Gobain, Concept Logistics, Gujarat Alakalies and Kotak Logistics. Importantly, theports profitability remains robust at an EBIDTA margin of ~60%. APSEZ is in the process of completing the residualcapex at Dahej and will spend ~Rs2.5bn over FY15-16 in fully mechanizing the second berth and enhancing capacity ofthe back-up area. After this capex, Dahejs installed capacity will increase by 25% to 25m tonnes.




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Hazira Port a good startAPSEZ commissioned the Hazira Port in Jul-13 with a capitalized cost of ~Rs25bn. The port has a total cargo handlingcapacity of 35m tonnes, which comprises container handling capacity of 1.5m TEUs and bulk cargo handling capacityof 15m tonnes. The port has a design draught of ~17m and has been developed to handle bulk, break bulk, containerand liquid cargo. The overall master plan of the port envisages development of 13 berths in a phased manner with apotential cargo handling capacity of 100m tonnes. Hazira is located in close proximity to the highly industrialized beltof Surat and Ankleshwar in Gujarat. It is connected to key North-South and East-West National Highways and theDelhi-Mumbai Rail Corridor at Surat. The company is in the process of securing approval to construct a dedicated raillink that will connect the port to Surat. Hazira serves as an attractive alternate location to JNPT for handling containercargo, especially for users based in its immediate hinterland of North Maharashtra and Gujarat. Hazira handled 2.8mtonnes of cargo during April-Dec 2013; we estimate it to have handled 4m tonnes of cargo in FY14. Absence of directrail connectivity with the main line is,however, a key concern for growth of container cargo at Hazira.

Developing four terminals on BOT basis at Major PortsAPSEZ is developing three terminals at Major Ports under 30-year concessions on BOT basis one coal terminal eachat Mormugao Port and Visakhapatnam Port and an offshore bulk terminal at Kandla Port. Recently, APSEZ was also

awarded the project to develop the first container terminal at Ennore Port on BOT basis.

APSEZs new projects

Rs m Project cost Debt Equity & accruals Capacity (m tonnes) CODDahej 12,100 6,800 5,300 25* Sep-10Hazira I 25,000 17,500 7,500 35 Jul-13Vizag 4,000 2,800 1,200 7 Jul-14Kandla 12,000 8,400 3,600 20 Apr-15Mormugao 4,058 2,841 1,217 10 Oct-14CT-3 20,000 12,850 7,150 20 Jul-13Ennore 12,000 8,400 3,600 17 FY17

Source: Company data, IDFC Securities Research *-20mt currently

Coal terminal a t M ormugao

APSEZ is developing a coal terminal at Mormugao Port with an initial capacity of 7m tpa. The capacity will besubsequently ramped up to 10m tpa based on increase in volumes. The target markets are power and steel plants inWest and Central Maharashtra as also North Karnataka. Being a Major Port, Mormugao Ports tariffs would begoverned by Tariff Authority for Major Ports (TAMP). The concession agreement provides for operating the terminalon BOT basis till 15 May 2040. The terminal is undergoing trial runs currently and is likely to be commissioned byAug-14. Mormugao Port handled 7.5m tonnes coal in FY14.

Coal termi nal at Visakhapatnam

This coal terminal will have a capacity of ~7m tpa to handle imported coal volumes. The target markets of the port areindustries and power plants in Andhra Pradesh, Orissa, Chhattisgarh and Eastern Maharashtra. This terminal is also

aligned with the long-term strategic interest of the Adani Group to establish presence on the East Coast of India. Theterminal is undergoing trial runs currently and is likely to be commissioned by Jul-14. Visakhapatnam Port handled9.7m tonnes of coal in FY14.

Bulk t erminal a t Kandla

APSEZ is developing an offshore bulk cargo terminal project at Kandla Port. The proposed terminal would be agreenfield development located ~17km to the west of the mouth of the Kandla Creek. The proposed dry bulk terminalwill have a capacity of 20m tonnes to handle cargo like coal, foodgrain, fertilizers and minerals. Evacuation from thenew terminal would be through a new 11km rail link to the existing Kandla Port (not in Adani Ports scope of work).Cargo handling at the inner harbor at Kandla Port remains constrained due to insufficient draught, and developmentof this offshore terminal is aimed at addressing this bottleneck. As a result, cargo at this terminal is likely to scale up




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rapidly due to the shift in handling from the inner harbor. The project has an estimated development cost of Rs12bnand commissioning is likely by end-FY15.

Container t ermi nal at Ennore

APSEZ was recently awarded the Ennore Container terminal project. The estimated project cost of Rs12bn will be

incurred in phases over six years. Phase I will involve an outlay of Rs6.5bn in the first two years, leading to a capacityof 0.8m TEUs. Phase 2 capex has to be incurred in the 5 th and 6 th years and will involve an outlay of the remainingRs5.5bn. It would take the total capacity to 1.4m TEUs. APSEZ bagged the project at a revenue share of 37%. TheEnnore Port is located 24km north of Chennai and was originally developed as a satellite port to the Chennai Port andto primarily handle thermal coal. While the other major ports are operated as Port Trusts, the Ennore Port isincorporated under the Companies Act 1956. As a result, tariffs at Ennore Port are not governed by TAMP regulationswhich apply to other Major Ports. The port predominantly handles only coal cargo at present and APSEZ would bedeveloping the first container terminal at the port. We have not yet factored this asset in our estimates.

Evacuati on constrai nt s at Chennai Port l ead to i neffi ciencies

The Chennai Port handled container cargo of 1.5m TEUs in FY14 (down 5% yoy). Chennai is a city-based port andevacuation is constrained due to urbanization around the port. The last mile road connectivity at the port iscongested and has traffic restrictions. Rail evacuation too is constrained due to inadequate support infrastructurewithin the port. The share of rail-based cargo is only 12% at Chennai compared with 24% for all Major Ports puttogether. Availability of sufficient back-up area too is a key bottleneck in the efficient handling of cargo.

Ennore Port prov i des superi or i nfrast ructur e

The Ennore Port has ~2,000 acres of land available for creating a back-up area and other support infrastructure. Theport will provide a back-up area of 90 acres for the proposed container terminal. Ennore Port is connected by rail toChennai-Kolkata broad gauge main line which is at about 6km from the port. The port has also undertaken a projectto provide dedicated rail connectivity to the proposed container terminal. Road connectivity is through NH4, NH5and NH45. The channel draught at Ennore Port is 16m and a similar draught will be provided by the Ennore Port atthe proposed container berth, enabling it to handle container vessels up to 14,500 TEUs. The proposed berth length

will be 730m. Environment clearance for this project is in place, facilitating smooth execution.

New ventures to account for 35% of consolidated cargo by FY16ECargo from new ventures like CT-3, Dahej and Hazira is growing rapidly. Further, APSEZs new BOT assets ofMormugao and Vizag will be commercially operational in FY15E and Kandla will commence operations in FY16E. Weestimate cargo from these new ventures to clock 81% CAGR over FY14-16 from 19m tonnes in FY14 (estimated) to 61mtonnes in FY16. The contribution of these projects will rise from 16% of consolidated cargo to 35% by FY16E.

APSEZs consolidated cargo volumes

Cargo (m tonnes) FY11 FY12 FY13 FY14E FY15E FY16EMundra Port (standalone) 52 68 82 94 104 113

CT-3 (at Mundra Port) - 7 12 15Kandla 12Dahej 1 2 8 8 11 15Mormugao - - - - 2 4Hazira - - - 4 8 12Vizag - - - - 2 4Consolidated cargo (mt) 52 70 90 113 138 174Cargo from new ventures 8 19 35 61% cargo from new ventures - - 8.4 16.4 25.0 34.8Source: Company data, IDFC Securities Research




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Potential opportunities: The next leg of growth

With current container handling capacities fast getting filled up, APSEZ is evaluating partnership with a majorcontainer shipping line for its fourth container terminal (CT-4) at Mundra on similar lines of CT-3 with MSC. Thedevelopment of a proposed 5m tpa LNG terminal at Mundra too is in advanced stages. APSEZ has the potential to

handle additional crude cargo at Mundra based on the expansion plans of its clients. APSEZ is also evaluatingacquiring the 25m tpa Dhamra Port, which will help meet its strategic objective of gaining significant presence on theEast Coast. The SEZ business, with a land bank of 16,000 acres, is likely to emerge a key value creator due to increasingchallenges in land acquisition for industries.

Development of fourth container terminal at MundraThe first two container terminals at Mundra, CT-1 and CT-2, are each operating at ~70% capacity utilization. The thirdcontainer terminal has, in its first full year of operations (FY14), attained 40% utilization. Therefore, APSEZ is soonplanning to take up development of its fourth container terminal (CT-4) in the South Basin. This terminal is likely tohave similar specifications as CT-3s with a cargo handling capacity of ~1.5m TEUs and ability to handle vessels of upto 14,500 TEUs in size. APSEZ is planning partnership for CT-4 on the lines of the MSC tie-up for CT-3. In CT-3,

besides having a 50% equity interest, APSEZ earns 20% royalty on handling income and undertakes the entire marinehandling (which typically accounts for 20-25% of aggregate revenues from container handling). APSEZ is also likely toget an upfront consideration in lieu of waterfront development and lease of back-up land to the terminal.

Development of 5m tpa LNG terminalGSPC, along with Adani Enterprises and a third partner (yet to be firmed up), plans to develop a 5m tpa LNG terminalat Mundra. Our checks with GSPC indicate that the venture has already placed orders for long-lead items like storagetanks and gasifiers. APSEZ will have a three-fold revenue stream from this development; i) upfront payment for leaseof waterfront, ii) recurring payments for land leased for back-end handling and storage infrastructure, and iii) marineincome from handling of cargo vessels.

Increased crude offtake by existing clients HMEL and IOCLHMEL (HPCL-Mittal Energy) plans to increase its refining capacity at Bhatinda from 9m tonnes to 11.2m tonnes in thenear term and eventually to 18m tonnes. It is in the process of tying up funds for this expansion. GGSR is connected toMundra through a dedicated pipeline, and an expansion in its refining capacity would bring in additional crude cargofor Mundra. IOCL too is evaluating expanding the capacity of its Panipat refinery from 15m tonnes to 18m tonnes.Both these expansions will lead to additional crude handling at Mundra.

Acquisition of Dhamra PortDhamra is a greenfield non-major port in Orissa and has been developed by a JV of L&T and Tata Steel (50:50). Theport has a capacity of ~25m tonnes for handling bulk cargo. The JV plans to scale up capacity to 100m tonneseventually. APSEZ has dominant presence on the West Coast and has been seeking to gain a foothold on the EastCoast. It is evaluating acquiring the Dhamra Port from its current owners to further this strategy.

Dhamra Port key highligh ts

Parameter DetailCapacity 25mtpaProposed capacity post expansions 100mtpaProject cost incurred Rs36.4bnEquity invested by current promoters Rs7.6bnSponsor loans Rs9bnCargo handled in FY14 14.3mt (+29%yoy)Source: Company data, IDFC Securities Research




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D hamra achi eves key mi l estones for i t s expansion pl ans

Dhamra Port has received the final environment clearance for its Phase II expansion. The project entails capacityexpansion to 100m tpa from ~25m tpa at present. The port requires ~1,000 acres of land for expansion, of which 300acres are available with the port. Dhamra had sought allotment of 740 acres from the Odisha government to meet the

remaining land. According to press reports (source Business Standard, 23 April 2014), the Odisha government hasgiven an in-principle approval for the same. With this approval, Dhamra has achieved two key milestones required forits expansion plans. We believe this improves visibility of the acquisition being completed in the near future.

Acquisi t ion unl i kely t o be cheap, but premium appears j usti fi ed

According to media reports (source Business Standard, 16 Jan 2013), APSEZ is likely to acquire Dhamra Port for an EVof ~Rs55bn. With total debt of ~Rs35bn in Dhamra (including sponsor loans of Rs9bn), the implied equityconsideration is ~Rs20bn (P/B of 2.6x of total equity invested of Rs7.6bn). In comparison, APSEZ stock trades at P/B of4.3x FY14E. Given that Dhamra incurred a net loss of Rs3.4bn in FY13 and with further losses likely in FY14 and FY15,the implied deal valuation seems rich. However, we believe the valuation premium is justified given the high entry

barriers in the sector, Dhamras well developed infrastructure and its scalability potential.

APSEZ our preferred play in the infra space

APSEZ remains our preferred infra play given its strong growth profile (24% earnings CAGR over FY14-16E) and arobust balance sheet. A strong cash generation outlook should also lead to sharp reduction in leverage in the comingyears. APSEZs SEZ business, with its ~16,000 acres land bank, is likely to emerge as a key value creator as landacquisition for industries is becoming increasingly difficult. Reiterate Outperformer on the stock with a DCF-based 12-month price target of Rs235.

Cash generation to remain strong; expect leverage to come downOn the back of our estimate of 24% CAGR in consolidated cargo over FY14-16 to 174m tonnes by FY16E, we estimate29% growth in EBIDTA and 24% growth in earnings for APSEZ. With capex intensity at APSEZ peaking, we estimate a

high free cash generation. We have upgraded our FY15E and FY16E earnings by 5.4% and 11.4%, respectively due tohigher than expected scale up in APSEZs new assets and improved prospects for the SEZ business. As a result, weexpect a sharp drop in leverage for APSEZ over the next two years. We estimate consolidated D/E to drop to 0.5x byMar-16 from 1.2x in FY14E and Debt/ EBIDTA to drop to 1.5x from 3.8x over the same period.

Expect a sharp increase in free cash flow

(40)

(20)

0

20

40

FY12 FY13 FY14E FY15E FY16E

(Rsbn) Free cash f rom operations (s tandalone)

(60)

(40)

(20)

0

20

40

FY12 FY13 FY14E FY15E FY16E

(Rsbn) Free cash f rom operations (consolidated)

Source: Company data, IDFC Securities Research




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APSEZ DCF-based price target of Rs235

Project (Rs m) Basis of valuatio n Value of equity Stake APSEZ value Cost of Per share

(Rs m; Mar-15) (%) (Rsm; Mar-15) equity (%) value (Rs)Mundra Port DCF 255,901 NA 255,901 14 124CT-3 (at Mundra) DCF 35,116 50 17,558 14 8SEZ DCF 110,337 NA 110,337 15 53Dahej Terminal DCF 42,778 74 31,656 14 15VPT DCF 1,951 100 1,951 14 1Hazira DCF 42,621 100 42,621 14 21Mormugao DCF 4,279 100* 4,279 15 2

Adani Logistics P/B 12,474 100 12,474 NA 6Kandla DCF 10,079 100* 10,079 16 5Total value 515,410 486,730 235Source: Company data, IDFC Securities Research*-economic interest




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Analyst Sector/Industry/Coverage E-mail Tel. 91-22-6622 2600 Shirish Rane Head of Research; Construction, Power [email protected] 91-22-662 22575Prakash J oshi Oil & Gas, Metals, Mining [email protected] 91-22-662 22564Nitin Agarwal Pharmaceuticals, Real Estate, Agri-inputs [email protected] 91-22-662 22568Hitesh Shah, CFA IT Services & Telecom [email protected] 91-22-662 22565Manish Chowdhary Financials [email protected] 91-22-662 22563Bhoomika Nair Engineering, Cement, Power Equipment, Logistics [email protected] 91-22-662 22561Pramod Kumar Automobiles, Auto ancillaries [email protected] 91-22-662 22562Rohit Dokania Media & Entertainment [email protected] 91-22-662 22567Ashish Shah Construction, Power [email protected] 91-22-662 22560

Abhishek Gupta Telecom, IT services [email protected] 91-22-662 22661Mohit Kumar, CFA Construction, Power [email protected] 91-22-662 22573Param Desai Pharmaceuticals, Real Estate, Agri-inputs [email protected] 91-22-662 22579Probal Sen Oil & Gas [email protected] 91-22-662 22569Saumil Mehta Metals, Mining [email protected] 91-22-662 22578Harit Kapoor FMCG, Retail, Alcoholic Beverages [email protected] 91-22-662 22649Sameer Bhise Financials [email protected] 91-22-662 22635Abhishek Ghosh Engineering, Cement, Power Equipment, Logistics [email protected] 91-22-662 22658

J ay Kale, CFA Automobiles, Auto ancillaries [email protected] 91-22-662 22529Dharmendra Sahu Database Analyst [email protected] 91-22-662 22580

Equity Sales/Dealing Designation E-mail Tel. 91-22-6622 2500

Anish Damania Head Institutional Equities [email protected] 91-22-6622 2522Ashish Kalra Managing Director, Sales [email protected] 91-22-6622 2525Rajesh Makharia Director, Sales [email protected] 91-22-6622 2528Varun Saboo VP, Sales [email protected] 91-22-6622 2558Arati Mishra VP, Sales [email protected] 91-22-6622 2597

Hemal Ghia VP, Sales [email protected] 91-22-6622 2533 Tanvi Dixit AVP, Sales [email protected] 91-22-6622 2595Nirav Bhatt AVP, Sales [email protected] 91-22-6622 2681Chandan Asrani Manager, Sales [email protected] 91-22-6622 2540Sneha Baxi Manager, Sales [email protected] 91-22-6622 2537Samir Gilani Head of Trading [email protected] 91-22-6622 2535Mukesh Chaturvedi Director, Sales trading [email protected] 91-22-6622 2512Viren Sompura SVP, Sales trading [email protected] 91-22-6622 2527Rajashekhar Hiremath SVP, Sales trading [email protected] 91-22-6622 2516Alok Shyamsukha VP, Sales trading [email protected] 91-22-6622 2523

IDFC Securities US Designation E-mail TelephoneRavilochan Pola CEO [email protected] 001 646 756 5865

Disclaimer This document has been prepared by IDFC Securities Ltd (IDFC SEC). IDFC SEC and its subsidiaries and associated companies are a full-service, integrated investment banking, investmentmanagement and brokerage group. Our research analysts and sales persons provide important input into our investment banking activities.

This document does not constitute an offer or solicitation for the purchase or sale of any financial instrument or as an official confirmation of any transaction. The information contained herein is from publicly available data or other sources believed to be reliable. While we would endeavor to update the information herein on reasonable basis, theopinions and information in this report are subject to change without notice and IDFC SEC, its subsidiaries and associated companies, their directors and employees (IDFC SEC and affiliates) areunder no obligation to update or keep the information current. Also, there may be regulatory, compliance, or other reasons that may prevent IDFC SEC and affiliates from doing so. Thus, theopinions expressed herein should be considered those of IDFC SEC as of the date on this document only. We do not make any representation either express or implied that information containedherein is accurate or complete and it should not be relied upon as such.

The information contained in this document has no regard to the specific investment objectives, financial situation or particular needs of any specific recipient. This document is prepared forassistance only and is not intended to be and must not alone be taken as the basis for an investment decision. The investment discussed or views expressed in the document may not be suitablefor all investors. Investors should make their own investigations as they deem necessary to arrive at an independent evaluation of an investment in the securities of companies referred to in thisdocument (including the merits and risks involved) and investment decisions based upon their own financial objectives and financial resources. Investors assume the entire risk of any use made ofthe information contained in the document. Investments in general involve some degree of risk, including the risk of capital loss. Past performance is not necessarily a guide to future performanceand an investor may not get back the amount originally invested.Foreign currency-denominated securities are subject to fluctuations in exchange rates that could have an adverse effect on the value or the price of, or income derived from, the investment. Inaddition, investors in securities, the values of which are influenced by foreign currencies, effectively assume currency risk.Affiliates of IDFC SEC may have issued other reports that are inconsistent with and reach different conclusions from, the information presented in this report.

This report is not directed or intended for distribution to, or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction, where suchdistribution, publication, availability or use would be contrary to law, regulation or which would subject IDFC SEC and affiliates to any registration or licensing requirement within such jurisdiction.

The securities described herein may or may not be eligible for sale in all jurisdictions or to a certain category of investors. Persons in whose possession this document may come are required toinform themselves of, and to observe, such applicable restrictions.Reports based on technical analysis centers on studying charts of a stock's price movement and trading volume, as opposed to focusing on a company's fundamentals and, as such, may notmatch with a report on a company's fundamentals.

IDFC SEC and affiliates, their directors, officers, and employees may from time to time have positions in, purchase or sell, or be materially interested in any of the securities mentioned or relatedsecurities. IDFC SEC and affiliates may from time to time solicit from, or perform investment banking, or other services for, any company mentioned herein. Without limiting any of the foregoing, inno event shall IDFC SEC, any of its affiliates or any third party involved in, or related to, computing or compiling the information have any liability for any damages of any kind including but notlimited to any direct or consequential loss or damage, however arising, from the use of this document. Any comments or statements made herein are those of the analyst and do not necessarilyreflect those of IDFC SEC and affiliates.

This document is subject to changes without prior notice and is intended only for the person or entity to which it is addressed and may contain confidential and/or privileged material and is not forany type of circulation. Any review, retransmission, or any other use is prohibited.

Though disseminated to all the customers simultaneously, not all customers may receive this report at the same time. IDFC SEC will not treat recipients as customers by virtue of their receiving this report.IDFC Capital (USA) Inc. has reviewed the report and, to the extent that it includes present or past information, it is believed to be reliable, although its correctness cannot be assured.

The analyst certifies that all of the views expressed in this research report accurately reflect his/her personal views about any and all of the subject issuer(s) or securities. The analyst certifies that nopart of her compensation was, is , or will be directly or indirectly related to the specific recommendation(s) and/or views expressed in this report.

Additional Disclosures of interest:1. IDFC SEC and its affiliates (i) may have received compensation from the company covered herein in the past twelve months for investment banking services; or (ii) may expect to receive or

intends to seek compensation for investment-banking services from the subject company in the next three months from publication of the research report.2. Affiliates of IDFC SEC may have managed or co-managed in the previous twelve months a private or public offering of securities for the subject company.3. IDFC SEC and affiliates collectively do not hold more than 1% of the equity of the company that is the subject of the report as of the end of the month preceding the distribution of the research report.4. IDFC SEC and affiliates are not acting as a market maker in the securities of the subject company.

Explanation of Ratings:1. Outperformer : More than 5% to Index

2. Neutral : Within 0-5% (upside or downside) to Index3. Underperformer : Less than 5% to Index

Copyright in this document vests exclusively with IDFC Securities Ltd.




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Adani Ports & SEZ

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