Skip to content

    Aegis Logistics

    AEGISLOGGood
    Oil, Gas & Consumable Fuels·19 Nov 2024
    Management Summary

    Aegis Logistics delivered its highest-ever half-yearly performance in H1 FY25, characterized by record EBITDA and PAT growth across both its Liquids and LPG divisions. The company is aggressively executing a ₹4,500 crore capex plan, with significant capacity expansions in LPG and liquids nearing completion. Management remains confident in achieving a 25% CAGR through FY27, supported by new projects in ammonia and a strategic IPO for its Vopak JV.

    Highlights

    8

    • Achieved record consolidated normalized EBITDA of ₹487 crores in H1 FY25, up 10% YoY.

    • Profit After Tax (PAT) increased by 10% YoY to ₹310 crores for the half-year period.

    • Liquids division reported a 27% YoY increase in EBITDA to ₹201 crores, driven by new capacities.

    • LPG logistics throughput volumes grew 9% YoY to 2.08 million metric tonnes.

    • Total Capex program of ₹4,500 crores by FY27 is approximately 50% complete or in progress.

    • Announced a new standalone liquid storage terminal in Mumbai with 150,000 kL capacity at a cost of ₹250 crores.

    • Aegis-Vopak Terminals Limited (AVTL) subsidiary filed a DRHP for an IPO to reduce debt and fund growth.

    • Secured an anchor customer commitment for the upcoming 25,000 metric tonne ammonia terminal in Pipavav.

    What Changed1

    vs Q1 FY26

    Tone shiftStrong → Good

    Key financials

    Single quarter

    04 metrics
    1. 01Consolidated Normalized EBITDA₹487 Cr+10%YoY
    2. 02Profit After Tax₹310 Cr+10%YoY
    3. 03Earnings Per Share₹7.33+6%YoY
    4. 04LPG Logistics Throughput2.08 Mn+9%YoY

    Segment breakdown

    • Liquids Business₹201 Cr41.3%
    • LPG Business₹286 Cr58.7%
    Donut· Share of EBITDA

    Guidance & targets

    5
    CategoryTargetPriority
    Profitability
    Average CAGR Growth
    25%
    		High
    Capex
    Total Capital Expenditure Program
    ₹4,500 crores
    		High
    Capacity
    LPG Storage Capacity Expansion
    130,000 metric tonnes
    		High
    Capacity
    Mumbai Liquid Storage Terminal
    150,000 kL
    		Medium
    Margin
    Ammonia EBITDA Margin
    90%
    		Medium

    Risks & concerns

    6
    RiskSeverity

    Competition from Natural Gas/CNG

    Potential impact on LPG distribution volumes if CNG prices remain lower; management notes LPG is currently 10-20% cheaper but fuel competition is constant. — Analyst acknowledged

    medium

    Sourcing Volume Decline

    Sourcing volumes fell from 400k to 318k tonnes; management claims this segment has slim margins and does not significantly impact EBITDA. — Analyst downplayed

    low

    Execution Risk of Large Capex

    The company is managing a massive ₹4,500 crore capex program; delays in permits or construction could impact the 25% CAGR guidance. — Management acknowledged

    medium

    Areas of Evasion(3)

    • Specific post-IPO stake in AVTL
    • Hydrogen capacity filing details
    • Detailed impact of IPO on current shareholders

    Q&A highlights

    3

    “Will be standalone.”

    Clarifies that the new ₹250 crore Mumbai expansion will be 100% owned by Aegis Logistics rather than being part of the Vopak JV.

    asked by Vikram Suryavanshi

    2 min read5 chapters

    Detailed Narrative

    01

    Record Financial Performance and Growth

    Aegis Logistics reported a record H1 FY25 with consolidated normalized EBITDA reaching ₹487 crores, a 10% increase year-on-year. Profit After Tax also grew by 10% to ₹310 crores, with EPS rising to ₹7.33. The growth was broad-based, with the Liquids division seeing a 27% EBITDA surge to ₹201 crores and the LPG division delivering its highest-ever H1 EBITDA of ₹286 crores.

    02

    Aggressive Infrastructure Expansion Strategy

    The company is halfway through a massive ₹4,500 crore capex program aimed at completion by FY27. Key projects include a 130,000 metric tonne LPG storage expansion at Mangalore and Pipavav, expected to be online by the end of FY25. Additionally, a new 150,000 kL standalone liquid terminal in Mumbai was announced with an estimated cost of ₹250 crores, further strengthening Aegis's port-led logistics dominance.

    03

    Strategic Pivot to Ammonia and Sustainable Fuels

    Aegis is diversifying into ammonia terminaling with a 25,000 metric tonne facility in Pipavav, Gujarat. Management revealed that ammonia offers 2.5x to 3x the revenue rates of LPG throughput with high EBITDA margins of approximately 90%. The project has already secured an anchor customer commitment, signaling strong market demand as India transitions toward cleaner energy sources.

    04

    Aegis-Vopak Terminals (AVTL) IPO Filing

    A significant corporate development is the filing of a Draft Red Herring Prospectus (DRHP) for an IPO of the Aegis-Vopak Terminals Limited subsidiary. The proceeds are intended to reduce outstanding debt and fund general corporate purposes. While management was tight-lipped on specific dilution details due to regulatory restrictions, they emphasized that the reduction in interest costs would help compensate for the increase in minority interest.

    05

    LPG Logistics and Pipeline Integration

    LPG logistics throughput volumes reached 2.08 million metric tonnes in H1 FY25, a 9% increase. The upcoming Kandla-Gorakhpur pipeline, expected to be commissioned by mid-2025, is anticipated to further boost volumes. Despite a slight decline in distribution and sourcing volumes, management remains focused on high-margin logistics throughput, which remains the primary driver of EBITDA.

    This is an AI-generated summary of a publicly available earnings call transcript. It is for informational purposes only and does not constitute investment advice, a recommendation, or an endorsement. inve.money is not a SEBI-registered investment advisor. Please consult a qualified financial advisor before making any investment decisions.