Adani Ports, JSW Infrastructure may post double-digit EBITDA growth in Q1: Nomura

Nomura has reiterated its 'Buy' ratings on Adani Ports and Special Economic Zone (Adani Ports) and JSW Infrastructure, expecting both port operators to deliver double-digit EBITDA growth in the June quarter, supported by higher cargo volumes and improving logistics operations.

The brokerage estimates Adani Ports' EBITDA will grow 16% year-on-year in Q1FY27, while JSW Infrastructure's EBITDA is expected to rise 12%.

Adani Ports reported a 15% year-on-year increase in port traffic to 138 million tonnes during the quarter, driven by "robust container traffic growth" of 17-18% and higher liquid cargo volumes following the commissioning of the VLCC terminal at Mundra. The consolidation of the NQXT terminal also supported overseas traffic growth.

Nomura estimates Adani Ports' revenue will rise 21% year-on-year, led by a 24% increase in port revenue on the back of higher traffic, better realisations and an improved cargo mix. However, logistics revenue is expected to grow a modest 6% as rail volumes declined.

For JSW Infrastructure, the brokerage expects revenue to grow 8% year-on-year, supported by a 6% rise in port revenue and a 25% jump in logistics revenue due to the ramp-up of newly acquired assets and continued healthy performance of Navkar Corporation.

"We estimate ADSEZ's EBITDA margin at 58%" and expect JSW Infrastructure's EBITDA margin to improve to 49.1%, primarily due to stronger logistics profitability, Nomura said.

The brokerage noted that India's overall port traffic grew 3% year-on-year during April-May FY27, with container volumes rising 8%, offsetting weaker petroleum, oil and lubricants (POL) and coal cargo.

Nomura also highlighted recent strategic developments for both companies. It expects Mediterranean Shipping Company's US$1.4 billion investment in Adani Ports' Vizhinjam terminal to improve cargo visibility, accelerate traffic ramp-up and strengthen the port's position on key trade routes.

For JSW Infrastructure, the brokerage said the recently awarded Kolkata container berth project will add 0.93 million TEUs of capacity, increasing the company's overall container handling capacity to about 1.8 million TEUs and supporting its strategy to expand third-party cargo operations.