Stock report on Gateway Distriparks Ltd. A mid cap stock from logistics sector.
Company
Gateway Distriparks Ltd. is a joint venture promoted by a consortium (NTSC, Parameshwara Holdings Ltd, Windmill International Pvt Ltd and Thakral Corporation Ltd) to conduct the business of Warehousing, Container Freight Stations, providing handling and clearance of sea borne Exim Trade in containerized form.
The company operates container freight stations (CFS) at Navi Mumbai, Chennai, Vishakapatnam and Inland Container Depot at Garhi Harsaru. The CFS at Navi Mumbai, spread over 14 hectares, has a capacity to handle 216,000 TEU’s per annum.
The CFS at Chennai spread over 7.5 hectares, having a capacity to handle 40000 TEU’s, is situated at a distance of 16km from Chennai Port. (TEU is Twenty Foot Equivalent). The CFS at Vishakapatnam, commissioned in August 2005, has a capacity to handle 30000 TEU’s per annum and would cater to the traffic movement at the new container terminal at Vishakapatnam.
GDL receives import and export cargo from its clients at its CFS located close to ports and they are suitably transported to their final destination.
Its subsidiary, GRF (Gateway Rail Freight) had commenced container rail operations during the year ended March 2008, with the deployment of eight container trains. And by the end of March 2010, GRF owned and operated 18 container trains and 235 road trailers for meeting the needs of customers in the domestic and the export-import segment.
GRF had posted a net loss of Rs 12.7 crore on consolidation after minority basis for year ended March 2010. In addition, GDL through its subsidiary Snowman Frozen Foods (SFF) is one of the few pan-India cold chain logistics players. Gateway Distriparks has a 48.9% stake in Snowman Frozen Foods at the end of March 2010.
Stock financial details
With India's external trade growing, company's CFS volumes grew 5.6% year-on-year to 83, 500 TEUs in the second quarter. Average realizations improved 6.5% per TEU. It helped the company’s standalone operating profit margin improve 80 basis points year-on-year to 49.8% in the September 2010 quarter. Its net sales also rose 6.1% in the quarter.
Gateway Distripark is a consistently dividend paying stock for past 4 years. Dividend yield has been 3-4%. In year 2010, dividend yield was Rs. 4.5 (>4% at current stock price) which makes it one of the best dividend paying stock.
Stock Valuations
Gateway Distriparks is at Rs 107 per share and has a P/E of 15.06 on a trailing four quarter basis. Considering expansion plans and robust economic prospects in the country, investors may consider to buy stocks of Gateway Distriparks for long term investment portfolio.
