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CD Equisearch
Aegis Logistics (Accumulate)
CMP: ₹459.50
Target: ₹560
Aegis Logistics is India’s leading oil, gas and chemical logistics company. The company operates a network of bulk liquid terminals, liquefied petroleum gas terminals, filling plants, pipelines and gas stations to deliver products and services. Aegis Group also operates internationally through its sourcing and trading subsidiaries located in Singapore. The company has recently completed its capacity expansion at Haldia and Pipavav and future plans for the same are in its final stages. Strategic joint venture with Itochu along with governmental reforms makes Aegis Logistics a decent investment opportunity. The opportunities outweigh the risks and through vertical integration strategy Aegis aims to address all the issues in the gas and logistics sector faced by its clients. The Indian oil and gas logistics sector is undergoing expansion with continued deregulation and liberalisation by the government. The business strategy for both gas and liquid division is to continue growth in all the segments by expanding terminal capacity and enlarging the retail and distribution network. The concrete announcements of expansion plans aligned with the joint venture with Itochu Corporations are expected to come within January 2015 as communicated by the management.
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