Multi Bagger: Mundra Port - Recommended Price Rs 548.25

	S.P.Tulsian, Investment Advisor: Mundra Port and SEZ, an Adani group company, is the only listed non-captive private sector port. It is engaged in developing, operating and maintaining the Port and port based related infrastructure facilities, including multi-product SEZ. With the UPA getting second term, the thrust is expected to be on infrastructure development and port development is expected to get further impetus. That puts Mundra in an extremely advantageous position in the current times. Its agreement with Maruti, for the export of the A-Star car has started bearing fruit. Currently the export markets are dull and despite that the company has managed to do well, so once the markets in Europe starts picking up, business will boom, for both Maruti as well as Mundra. The fact that there has been a growth in cargo
	Past Multi Baggers Recommendations Stock Reco Price Peak after reco %Gain Balasore Alloys 6 78 1203 Reliance Infra 330 3202 870 TRF 240 2100 775 Opto Circuits 119 581 390 Usha Martin 32 154 380 Genus Power 246 1050 328 IDFC 55 235 327 Indo Tech Trans 200 808 304 Hind Zinc 288 1119 289 Thermax 255 968 280
	volumes is indicated by the financial performance of the company. For FY09, the net revenue of the company grew 45% at Rs.1188.05 crore. EBITDA was up 30% at Rs.734 crore. Net profit for FY09 has more than doubled to Rs.432.52 crore. One can argue that the doubling up o net profit is on account of the lower tax of Rs.53.34 crore in FY09 compared to Rs.149.44 crore it posted in FY08. But this was on account of tax incentives it has received for the SEZ. Yet, the 45% growth in pre-tax profit is not small fry. The performance for Q4FY09 shows a marginal decline in revenue, a fall of 13% on a YoY basis. The slump in the revenue was mainly on account of lower receipt of lump sum income from sale of leases in the SEZ. Given the slump in realty, it may take a quarter or two more for the booking in SEZ space to take off but once companies get back on their capex plans, SEZ rentals will become a major bread winner. There is no cause for concern over the Q4 revenue as there are indications of a growth in volumes of cargo and also the mix of the cargo has got better as it has now moved more in favour of bulk. Cargo handled during Q4FY09 grew by 12% to 9.5 million tonnes and this growth is way above the average of 1% growth recorded by all major ports in this period. For FY09, cargo handled rose 24% and that is phenomenal given the fact port traffic in all over India grew 2.1% in FY-09 due to the global slowdown. 54% of the cargo came from bulk and of this, coal formed the main cargo. Once the economy bounces back, coal requirement will also go up significantly. Promoters hold 81.20% stake in the company of which, it has pledged 14.48%. Public float is 19.80% but of this, institutional holding is 9.22%. This actually leaves a meager floating stock of just 9.58%. For FY10, even on conservative estimates, it is expected to post net revenue to the tune of around Rs.900 crore and net profit is expected to be around Rs.625 crore. On an equity of Rs.402.02 crore, EPS would be at Rs.15.55. The company had touched a high of Rs.928 on 27th May 08’ and low of Rs.50 on 28th Nov 08’. At the current price of Rs.548.25, it is somewhere in between. At the current price of Rs.548.25, Mundra is a great buy as the company will boom with the economy. A good stock to ride the revival