Posted on April 8, 2021
Adani Ports and Special Economic Zone Ltd., India’s largest private Ports & Logistics company and the flagship transportation arm of the diversified Adani Group, is announcing the acquisition of the residual 25% stake in Adani Krishnapatnam Port Ltd.,for Rs. 2,800 cr. This will result in APSEZ increasing its stake from 75% to 100% in Krishnapatnam Port, according to the company’s release.
Together with the 75% ownership acquired in October 2020, the acquisition implies an enterprise value of Rs. 13,675 cr implying an EV/ FY21 EBITDA multiple of 10.3x.
Krishnapatnam Port is located on the east coast of India in Nellore district of Andhra Pradesh close to the border between Andhra Pradesh and Tamil Nadu. Krishnapatnam Port is an all-weather, deep water port has multi-cargo facility with a current capacity of 64 MMTPA. With a waterfront of 20 km and 6,800 acres of land, Krishnapatnam Port has a master plan capacity of 300 MMTPA and a 50-year concession.
The port is expected to have volumes of 38 MMT, revenues of Rs. 1,840 cr and EBITDA of Rs. 1,325 Cr in FY21. Since the acquisition, Krishnapatnam Port has focused on business process re-engineering which has resulted in EBITDA margins improving from 57% in FY20 to 72% in FY21.