Shares of JSW Infrastructure made a positive debut on the stock markets on October 15, rising 3 percent to Rs 329 after Nuvama Institutional Equities initiated coverage with a ‘buy’ call, emphasising on the upside citing multiple levers for growth.
With a target price of Rs 390, the domestic brokerage estimates an upside potential of 22 per cent from its previous close of Rs 319 on NSE. JSW Infra shares have gained 53 per cent since the beginning of the year.
Nuwama says JSW Infra, as the second-largest private port operator in a steadily growing industry, is set to benefit from strong parentage and is expected to maintain strong growth in third-party cargo. Additionally, JSW Infrastructure is evolving from a port operator to a full-fledged logistics utility company, which is likely to continue its strong financial performance.
“We believe this could open up a massive opportunity in a highly fragmented market and add 5-10 per cent to its revenue or EBITDA in the long term. JSW Infra has the strength to capitalise on this opportunity given its strong balance sheet and high promoter shareholding,” Nuvama said in an October 14 report.
JSW Infrastructure (JSWIL) gets business from group customers, with future growth in JSW group companies expected to drive its business growth. JSW Steel targets 50 million tonnes of production capacity by FY31, while JSW Energy targets 10GW by FY25 and 20GW by FY30, up from 7.2GW in FY24. JSW Infra has 10-15 year contracts with JSW group companies for cargo handling, some of which have take-or-pay provisions, ensuring long-term cargo and revenue visibility.
At around 9:30 am, the company’s shares were trading at Rs 325 on NSE, up 2 per cent from its previous close price.
