Adani Ports & SEZ Achieves Landmark AAA Ratings

The AAA rating bestowed upon APSEZ is a testament to its resilient business model, impressive operational growth trajectory, and commendable profitability.

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A pivotal aspect contributing to APSEZ's stellar rating is its improving leverage ratio, with net external debt/PBILDT steadily declining from 3.62 times in March 2021 to 2.41 times by December 2023.

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In a landmark achievement for both Adani Ports & SEZ (APSEZ) and India's private infrastructure development landscape, the company has secured AAA ratings from Care Ratings. This prestigious rating, the highest accorded by credit-rating agencies, underscores APSEZ's robust creditworthiness and its capacity to fulfill financial obligations with the utmost reliability. Notably, this recognition marks a significant milestone as APSEZ becomes the first private infrastructure developer of its scale to attain such a distinction in India.

Resilient Business Model and Operational Growth

The AAA rating bestowed upon APSEZ is a testament to its resilient business model, impressive operational growth trajectory, and commendable profitability. It reflects the company's strong liquidity position and prudent leverage management. The CARE report attributes the high rating to several factors including the healthy expansion of operations, steady PBILDT margins (Profit before Interest, Lease, Depreciation, and Taxation), and APSEZ's demonstrated execution prowess in the port sector.

A pivotal aspect contributing to APSEZ's stellar rating is its improving leverage ratio, with net external debt/PBILDT steadily declining from 3.62 times in March 2021 to 2.41 times by December 2023. This positive trend underscores the company's commitment to financial prudence and effective debt management strategies. The progressive buyback of USD 650 million bonds further bolstered APSEZ's financial position, enabling substantial debt repayment.

Strategic Vision and Operational Excellence

APSEZ's success extends beyond financial metrics to its operational excellence and strategic vision. The company has a proven track record of revitalizing port assets post-acquisition, leveraging its integrated business model encompassing ports and logistics infrastructure. This approach has propelled APSEZ to achieve a remarkable 15% compounded annual growth rate for FY19-FY24, outperforming the 4% CAGR recorded by all Indian ports collectively.

Geographical Expansion and Diversification

The geographical expansion and diversification of APSEZ's portfolio are noteworthy. From operating two ports in 2011, the company has expanded its footprint to encompass 14 ports spanning India's entire coastline. This strategic growth has enhanced APSEZ's reach, operational efficiencies, and service offerings. With a 27% volume market share, APSEZ's ports serve as crucial gateways facilitating India's trade and economic development.

Integrated Approach: Ports, SEZ, and Logistics

Furthermore, APSEZ's integrated approach, combining ports with SEZ and logistics assets, reinforces its position as a leader in India's infrastructure sector. The strategic locations of its ports, including Mundra, Dhamra, and Krishnapatnam, further amplify the company's growth prospects and contribute to its resilience.

APSEZ's attainment of AAA ratings represents a watershed moment for India's private infrastructure sector, underscoring the company's excellence in governance, operational efficiency, and financial management. As APSEZ continues to chart its path of growth and innovation, its success serves as a beacon for the broader infrastructure landscape, signaling the potential for private players to drive sustainable development and contribute significantly to India's economic resurgence.

CARE report PBILDT margins Mundra APSEZ AAA ratings Adani Ports