Motilal Oswal: Lockdown Impacts Aegis Logistics’ Sourcing and Distribution Business
BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.
Motilal Oswal Report
Aegis Logistics Ltd.’s Ebitda miss was due to weak performance in the sourcing and distribution business, as public sector undertakings reduced liquefied petroleum gas (LPG) imports over May–June due to the overbooking of LPG cargoes in April 2020.
Higher imports in April 2020 were attributed to an expected boost in demand led by Pradhan Mantri Ujjwala Yojana (PMUY) scheme, which did not pan out as estimated.
Also, refiners ramping up throughput led to a domestic LPG supply glut. Aegis expects some improvement in LPG volumes from the current quarter (Q2 FY21), highlighting Q1 FY21 as a trough for FY21.
On the other hand, expect a boost in gas volumes in H2 FY21 from the Uran–Chakan pipeline and Pipavav Railway Gantry.
The company has been a key beneficiary of the government’s initiative to boost the penetration of LPG in the country. Although, for Aegis, investors have been wary of capacity utilization amid increasing competition.
Click on the attachment to read the full report:
This report is authored by an external party. BloombergQuint does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the brokerage and do not represent the views of BloombergQuint.
Users have no license to copy, modify, or distribute the content without permission of the Original Owner.