Container Corporation of India Ltd (CONCOR) reported a 4.51% increase in its consolidated net profit, reaching Rs 340.52 crore for the third quarter ended December 2024, compared to Rs 325.81 crore in the same period last year. Despite this modest profit growth, HSBC has maintained its ‘Hold’ rating on the stock while cutting the target price to Rs 780, citing concerns over the company’s overall performance and earnings outlook.
During the quarter, CONCOR’s consolidated revenue from operations remained almost flat at Rs 2,303.99 crore, marginally higher than Rs 2,302.12 crore reported a year ago. More concerning for investors was the company’s EBITDA, which declined by 10% year-on-year, signaling persistent pressure on operational efficiency.
HSBC pointed out that while management remains upbeat about future growth prospects in both domestic and export markets, the current quarter’s weak operational performance reflects the challenges CONCOR faces in improving profitability. The brokerage highlighted that the earnings downgrade cycle continues, suggesting that near-term upside might be limited unless there is a significant turnaround in revenue growth or cost management.
On a positive note, CONCOR’s Board of Directors declared an interim dividend of 85%, amounting to Rs 4.25 per equity share of face value Rs 5 each, totaling Rs 258.95 crore. This dividend payout underscores the company’s commitment to returning value to shareholders, despite the operational headwinds.
HSBC remains cautious, suggesting that flat revenue growth, falling EBITDA margins, and ongoing earnings pressure make it prudent to adopt a wait-and-watch approach on the stock, even as the company’s profit figures show modest improvement.
