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Adani Ports aims 500 million tonnes throughput and 40% market share by 2025

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Adani Ports and Special Economic Zone (APSEZ), in its FY21 annual report, has revealed its plans to continue growing its cargo operations with a special focus on logistical services in an effort to emerge as the preferred logistics partner for exporters and businesses.

As per the report, the company currently enjoys a 25% share of India’s Exim cargo and aims to almost double it to 40% in the next 4 years.  

“We intend to retain our position by achieving 500 million tonne cargo throughput by 2025 and will lead to enhancing our market share of the Indian market to 40%,” said the company. 

In FY21, APSEZ also showcased a growth of 11% from last year in terms of cargo handling volume, taking it to 247 million tonnes. This was against a 5 percent decline registered by all Indian ports.

With a clear focus to take the company’s return on capital employed (ROCE) to over 20 percent by 2025, as per the annual report, the Gautam Adani-led company reported a ROCE of 12 percent in FY21.

“Our maturing ports and newly acquired ports are growing in tandem as twin growth engines in enhancing free cash generation,” said the company.

Further, the company informed that the Dhamra and Kattupalli ports, acquired in 2015 and 2018 respectively, have turned around with positive returns on investments. 

The company during the year announced four major acquisitions — Krishnapatnam Port, Gangavaram Port, Dighi Ports, and Sarguja Rail Corridor Pvt. Ltd (SRCPL) — thus improving East Coast – West Coast parity. Further, they also announced the setting up of a container terminal at Colombo port in partnership with John Keells and SLPA.

Earlier in 2019, the company also announced its plans of setting up of container terminal in Myanmar. However, due to a military coup and subsequent violence, continuous monitoring of the evolving situation is being done. This disturbance has created uncertainties and plans to abandon the project and write down project investments in full is being considered if the country is classified under the Office of Foreign Asset Control (OFAC) taking into account shareholder opinion.

Speaking on the logistics front, the company has scaled up and diversified its railway rolling stock business taking advantage of changes in the General-Purpose Wagon Investment Scheme (GPWIS) of Indian Railways. This helped the company add contracts to operate 16 new rakes for raw material transportation from the mines, which earlier allowed serving customers just from ports.

“We set our sights to build 30 million square feet warehousing capacity during this period and has announced a strategic partnership with e-commerce player Flipkart,” said the annual report.

The company also intends to emerge as the world’s largest private port company by 2030.

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