Ind-Ra assigns APSEZ's NCDs final AA-plus with stable outlook
Sep 24, 2020
Mumbai (Maharashtra) [India], September 24 : India Ratings and Research (Ind-Ra) has assigned Adani Ports and Special Economic Zone's (APSEZ's) non-convertible debentures a final rating of AA-plus with a stable outlook.
APSEZ is the largest private port developer and operator in the country with operations across 10 ports (nine operational) in India. It handled around 22 per cent of the country's cargo volumes in FY20, up from about 10 per cent in FY10.
Ind-Ra said the company is well-positioned to benefit from structural growth in India's EXIM trade as a predominant portion of its cargo originates from or is destined for India.
The company has strategically located high-quality assets, with an average remaining concession life of 25 years (except Mundra port).
Its diversified presence along the Indian coastline, hinterland connectivity and ability to handle a diverse mix of cargo (bulk, container, crude) besides long-term take or pay contracts with customers, which insulates the business from most economic disruptions.
Mundra remains the company's largest port asset accounting for around 62 per cent of the consolidated volumes as of March.
However, according to the management, the concentration risk is likely to decrease with the ramping up of operations at the new ports (Hazira, Dhamra and Katupalli), as well as through the acquisition of the Krishnapatnam Port Company Ltd (KPCL) in January.
The company is also diversifying operations through its new port under construction in Myanmar, said Ind-Ra. APSEZ maintained a market share of 20 per cent in Q1 supported by resilient container throughput.
