Good afternoon everyone and welcome to Q3 FY26 earnings call of Gujarat Pipavav Port Limited. I'm Manish Agnihotri and we have Girish Aggarwal, Managing Director, and Santosh Breed, CFO, on the call.

We'll have opening remarks from Girish and then we'll take it forward for the Q&A. Over to you, Girish.

Thank you, Manish. The company delivered a strong financial performance this quarter as well.

The EBIT was higher by 18% quarter-on-quarter. This was driven largely by an increase in Ro-Ro volumes by about 39%-- Let me start again.

The company delivered a strong financial performance this quarter again. EBIT was higher by 18% quarter-on-quarter.

This was driven by a 39% increase in Ro-Ro volumes, which were highest ever in the quarter, 62,000-plus cars. Also, dry bulk volume continued its strong growth and was 25% higher.

Liquids and containers were broadly flattish. Containers, however, has shown a growth of approximately 7% quarter-on-quarter, vis-a-vis the previous quarter.

I will now talk about the 9-month result for this year, YTD. Overall YTD results are also strong with EBIT higher by 18% over previous year, driven by 40% growth in Ro-Ro volumes, 45% growth in dry bulk, and 13% growth in the liquid business.

Our EBITDA margins for the 9-month period is 58%, which is higher by 100 basis points over the previous year. This quarter, as per the new labor laws, we took a gratuity provision of approximately ₹4.8 crores, which sits in the extraordinary items.

I will pause here and we'll open for questions.

Thank you, Girish. Before I start the Q&A, I would request everyone to remain on mute.

Only when you are to ask the questions, can unmute yourselves. Thank you.

Deepankar Maurya, please go ahead.

Thank you, Manish. I hope I'm coming through well.

Yes.

Great. Thanks.

Thank you, Girish. My first question is on the outlook for container volumes.

When do you expect to see growth again for the segment? We've seen several quarters of year-on-year decline so far, and so when will be the turnaround likely, and what will be the key drivers for that?

In the same context, we've seen some India-Middle East services to the Mediterranean returning via the Red Sea, do you see any positive or negative impact from this development? This is the first question on the container outlook.

Do you want me to go through the rest of the questions, or should we take it one by one?

Let me answer this question and then, if it's okay with you--

Of course. Please go ahead.

Thank you.

Essentially, A, again there are some green shoots this quarter where we grew 7% over previous quarter, but again I will wait for some more data points to say that this is a bit more structural in nature. However, we are clearly seeing some positives.

A, as you rightly pointed out, shipping lines have started, albeit slowly, the transit through the Suez Canal, which augurs well because that releases capacity in the system, which was one of the reasons why some of the tonnages were pulled out of the services that were calling us and had negatively impacted us, so that is positive. Last quarter's numbers along with previous quarter numbers were also impacted by higher tariffs in the US on specially the textile and garment sector.

I think that is now getting behind us, I'm hopeful that some of those volumes will come back. MECL, which is a flagship service of Maersk for the East Coast, and it starts passing through the Suez, creates a much better product for our customers, I do expect that product to increase as we move forward.

There's some structural positives that have happened in the market. There is one quarter data point to suggest that there is a little bit of growth, but I think the right thing will be to just wait for this quarter as well in terms of performance on the container sector to see how things materialize.

Just a clarification, this 7% quarter-on-quarter growth which you're saying, right, it is also possible that this is because of seasonality, that the third quarter or the December quarter--

No, this is not seasonality. This is certain areas, and specifically on the Maersk services that we have grown our volumes.

Overall year-on-year, Jan to December if I were to look at that timeframe, Maersk grew its volumes by 15%, and this is through some structural initiatives that we have done with Maersk over the last two quarters, which have started to show some results. Let's wait for one more quarter, but I am seeing positive let's say momentum, if you will, on the container growth.

Also some of the good news is around the Red Sea opening up, Suez opening up should definitely benefit us.

Jan to December that is 15%, right? 15%.

Just for Maersk, I'm saying. Okay?

This is for Maersk. Okay.

Fine. That makes sense.

It's very clear. My next question is on the operating expenses development during the quarter, right?

This outpaced revenue growth both year-on-year and also on the quarter-on-quarter basis. Historically, you've guided that whenever fertilizer volumes increase, that tends to suppress the margins because it's more operating intensive.

This quarter we saw that sequentially, year-on-year of course there was a significant jump, 25%, overall dry bulk volumes. When we see sequentially, the fertilizer volumes did decline, but we did not see any benefit in the OPEX.

What exactly is happening there? Could you help us understand what is the true run rate over there?

Santosh.

Yeah. You are basically comparing it with the immediate previous quarter, right?

Either way, when we look at the difference between EBITDA to revenue, right,

the overall OPEX, when you look at it year-on-year also, it has outpaced the revenue growth, and

when you look at it quarter-on-quarter also, it has outpaced.

Basically if I just compare it first with the previous quarter, right,

then, of course, there's some catch up which has been done on certain maintenance activities which has been done. These are more of preventive nature.

Also, some additional spend in our CSR activities which were conducted during the quarter. Those are the key drivers.

Otherwise, if I really look at my operating expenses in comparison with immediate previous quarter in line with the bulk volume, they have been lower actually.

Roughly lower as compared to the previous quarter. If you compare it with the same quarter last year, the main, of course, one is the operating expenses because of the volumes, and second is the increments which happens on the employee benefits cost.

Okay. That makes sense.

The final question which I have is about the realizations for the quarter, if you could provide some guidance on that. Also, I saw a notification on your website that there has been some rate hike since the 1st of Jan.

If you could help us understand how much of this will pass through in terms of actual or average realizations, and will it be across cargoes, or is it specifically for containers?

First I'll take the question for the realization. The realizations for the current quarter has been maintained, no major change as compared to the previous quarter.

For container, it is in range of ₹9,500 to ₹10,500 per TEU. For bulk, it is ₹550 to ₹650 per metric ton.

For liquid, it is in range of ₹550 to ₹600 per metric ton. No major change as such in the realization.

On the tariff, yes, we've taken a tariff increase. Of course, it's mainly on container, but also on all marine services, which is applicable across all the business streams.

This increase in general has been taken in the range of around 5%, will get passed on to the customer based on our arrangement with them. Typically what we've seen on the top line, it should have an impact around 3% to 4% is what our expectation.

Okay. That is helpful.

Any updates or any developments on the concession renewal? That'll be my last question.

We continue to engage with the Gujarat Maritime Board. I think things are moving in the right direction.

Again, there's no specific update beyond what we said last time, but the engagement continues, the positive engagement continues, no red flags.

Okay. Thank you very much, and all the best for the future quarters.

Thank you.

Thank you. Mr.

Bhavesh Patel, please go ahead with your questions.

Congratulations on great set of numbers and thank you for this opportunity. The question around the concession was just asked and you've answered.

It was, in fact, I suppose because we have that plans for almost ₹17,000 crore investment, and I suppose that is contingent on the extension, right? That's the understanding, right?

Sorry, the investment of ₹17,000 crores is contingent on concession extension, of course.

Sure. Okay.

Understood. Again, we'll wait for the positive announcement whenever that happens.

We are almost in 2026 and it's ending in 2028 or so. Anyway, we'll see on that.

My question now is on the ONGC contract for the offshore supply base, and that's a significant win. Just want your help in terms of quantifying the expected revenue that we have over the let's say a year in terms of timeline.

Then are you in talks with any other upstream energy player in terms of utilizing the liquid as well as specialized cargo facilities that we have?

No, we will not be able to talk about ongoing commercial discussions with any other customers. Sorry about that.

Also in terms of revenue, etc., we are not giving any guidance to this single customer. We do not intend to give any guidance on specific customer revenue stream.

Sure. Fine.

Appreciate that. Again, linked with that, what's the progress in terms of our liquid jetty construction?

Is the same timeline in terms of December 2027 we're targeting, or any--

No, no. December 2026.

Sorry, December--

Sorry. December 2026, correct.

Yeah. On track for December 2026.

Perfect, perfect. Thank you on that.

Last question, again repeating, but GPPL, we have historically maintained almost 100% dividend payout ratio, assuming that everything goes on and we continue to have the plans for spending that ₹17,000 crore investment plan. As shareholders, do we expect any shift in terms of capital allocation, or so--

It's not right for me to comment. It is for the board to recommend to the AGM, and the AGM to approve, it's really not my place to comment, honestly.

Fine. Oh, appreciate this.

Thank you and again excited about the future. Best wishes for upcoming quarters.

Thank you, Girish.

Thank you. Mr.

Manan Poladia, please go ahead with your questions.

Hi sir. Congratulations on a good set and thanks for the opportunity.

I have a couple of questions for you. First, on the liquid side, the Kandla-Gorakhpur pipeline, I believe it was delayed earlier.

Just curious on whether there's an update on that and what time it should go live? Do you want me to go one by one or--

Let me answer this question, and then we can do one by one, please. We expect anywhere between March and June this year for the KGPL to kind of connect to us.

Right, sir. Perfect.

Thank you. Second question, I have a slightly bookkeeping question here on the liquid side again.

What should be the depreciation number we should expect for the full year '27 once it's commissioned?

You expect depreciation of the jetty?

Yes, of the jetty, of the CAPEX that we're putting in.

I'm really sorry. I don't have that number with me.

Understood. No problem, sir.

Just a couple more. On container volumes, I know you said you want to wait for a bit, but just curious how we're thinking about that in the context of all the deals that have happened, plus the freight markets normalizing a little bit?

If you could give me some color on that, that'd be great.

No, it's the same, right, what I talked about. With some of the positive news on the free trade agreements, bilateral agreements, it augurs well, especially on the garment and textile sector which kind of started to see a decline clearly.

The Red Sea, Suez opening up, capacity coming back, we do believe that things will definitely improve on the container side. Again, I really want to wait for Jan, Feb, March quarter to really then say things are moving structurally forward.

Right. Understood, sir.

Thank you for all your answers.

Thank you. Nilotpal, please go ahead with your questions.

Hi sir, thank you for the opportunity, and good evening. I have two questions.

First is, can you provide some outlook on fertilizer volumes, how they have been trending for this quarter, and how do you see them panning out for say FY27?

Yeah. Okay.

On fertilizer, of course, this quarter also was really a good quarter for us because if you look at in terms of volume, then we had done around 629,000 metric ton in the current quarter on the fertilizer side. Two back-to-back good quarters.

However, of course, it also means that there's some stocking which has been done now, we should see some dip. Then we also expect close to the monsoon again it picks up.

Roughly if I just look at the 3-month period, the fertilizer overall volumes will be close to about 1.6, 1.7 million tons. Usually, Jan, Feb, March is a lean quarter for fertilizers, and then it starts to pick up as monsoon starts.

April, May, June, July, August, September is usually the biggest quarters as we move forward. We will still maintain about 1.5 million to 2 million tons of fertilizer, but again, that we give the overall outlook for the full financial year when we talk next time with the full financial year results.

Thank you, sir. My second question was, when do you expect your Ro-Ro capacity expansion to come up, and how do you see volumes panning out next year?

I'm sorry. Which capacity expansion are you talking about?

The capacity expansion on Ro-Ro volumes.

On the Ro-Ro side, essentially we are now building a new staging area which expands our capacity. We expect it's a 60,000 square meter expansion.

Within March, we believe we should be closing about 30,000, and the rest of the 30,000 between May and June. That should give us additional capacity from an expansion perspective, but nevertheless, this capacity is not impeding on any volumes today.

We are able to find space within the port premises as and when needed to ensure that we are able to handle all cargoes or all car volumes even today, so that's just for our future benefit. In general, at least at this point in time, we have enough and more capacity on handling the cars.

What is our capacity now and what will it be after expansion in June?

On the car side, essentially the calculation is a little bit different, right? It depends on how many dwell days the car stands, etc., etc., but we believe we are in a position to handle anywhere between 250 to 300,000 cars today, and we will go up to about 400 to 450,000 cars in June.

Got it, sir. Do we have any exposure to South Africa?

They have been considering implementing a duty on exports of cars out of India. That you will have to ask the exporters.

Won't be able to comment.

Sure sir. Those were my questions.

Thank you.

Okay. Mr.

Parashar, please go ahead.

Mr. Parashar, Jatin Parashar.

Maybe Mr. Kunal Tokas, you can go ahead.

Mr. Kunal, we can't hear you.

Aditya, you can go ahead maybe.

Thanks, Manish, for the opportunity. I hope I'm audible to you all.

Yes. Yes.

Great. Few questions from my side.

A, what is the exposure on the container side to US and Europe, and should one be thinking through the recent change in course in both these geographies as being positive for the company?

No, essentially, I think it's difficult to say, right, sir, but it's anywhere in the region of 15% to 25% in general, I would argue.

Am I to assume it is for the combined exposure to Europe and US, that

you're

saying this number, or--

Yeah.

Okay. Understood.

On the container pricing front, which is a 5% increase, how much is kind of linked up to cost increases that the company foresees, and how much is potentially catch up in pricing given the meaningful difference, let's say, versus a Mundra that already exists, say?

No, no. This is not how we look at our pricing, our pricing is more dependent on market and nothing else.

It's very difficult for us to attribute increases to cost, etc., etc. That's not how we will look at it.

It's a 5% increase. We, as Santosh alluded, a 3% to 4% usually flows through.

Understood. So 3% to 4% on container revenues is what you're saying, and then lesser so on overall revenues?

Is that the way to think?

No, no, 3% to 4% on overall revenue Aditya, because

the

increase has been taken on container marine, and that's where the recent tariff, but even also on the other businesses, we do take regular increases on the contracts.

Understood. The third question that I had was on container volumes.

As in if I see the revenue trajectory from Maersk, it's been kind of flattish to declining from a revenue perspective. Then you're talking about this 15% growth that you've seen.

How much more can be covered up in terms of growth if we really get the equation on volumes with Maersk right? It still seems a far far distance away because a lot of the last five years have broadly kind of gone nowhere from a revenue perspective on that account.

Aditya, just to really understand your question, you are referring to the volume growth coming from Maersk Line and what more we can expect, is what the question is?

As in our sense is that when we see the annual report on the RPT transaction, it suggests that the Maersk revenues have kind of gone nowhere last five years, last 5-6 years. They are stuck in a certain zone.

Just wanted to get a sense of that while 15% already has happened for 9-month period, is there a lot more growth that can happen in that account to cover up for past losses of opportunities?

I'm unsure. I've already overall given you a color of how the market will grow, but the idea of giving at a customer level what will happen over the next five years is something that we don't intend to do.

The context of giving a 15, the number of 15% was to just attribute that there is some positive momentum structurally. There are certain things that we are trying to put in place.

At a customer level, we will not be in a position to kind of give future plans in terms of what growth is possible, what growth is not possible. We look at the container business overall, and we kind of will continue to give you a guidance of how we see the container overall volume developing.

Understood. Maybe a slightly related question, as in if you were to be doing the CAPEX and kind of deepen the draft, can the likeability of the port and thus container volumes see a meaningful uptick from here on, obviously hinging on the CAPEX,

but

just to get a sense of the quantum of benefit that can come on stream from that?

No, look, these are far-fetched at least at this stage. Obviously, if we are in a position to do a CAPEX, the idea is to grow the business and make it profitable, right?

Otherwise, there doesn't make sense to do the CAPEX. I think these are all far-fetched questions at least at this point in time.

We will not like to kind of answer the question, but in general, any CAPEX that we do has to result in profitable growth for the company.

Last question from my side on the expenses that have kind of caught up in this quarter. As in we saw some uptick in expenses in the last year same time in the third and fourth quarter.

Should one assume that on an annual basis these kind of expenses will be recurring in nature, and how to think through margins in that context incrementally? That'll be my final question.

Aditya, actually I don't think we should assume the same just because last two times we have seen this. As I explained, the main increases has come from two main reasons: one is the repairs and maintenance cost and also the CSR.

Repair and maintenance, of course, to certain extent there are some preventive maintenance which are planned in a particular quarter, we have some increases there. In those cases can remain, but again CSR is something it depends on what kind of activity has been done in that quarter.

It's not right to assume that this is a run rate we should consider for every third quarter of the year.

Got that. Those were my questions.

Thank you for responses. Thank you.

Thank you.

Mr. Vipul Kumar Shah, please go ahead.

Hi. Thanks for the opportunity.

My question is, what is our capacity for liquid, and post the expansion of this liquid jetty, what will be the capacity, and how the ramp-up of capacity utilization of expanded capacity will take place?

Depending on the commodities, roughly our current capacity is around the 1.6 to 1.75 million metric tons. The new jetty is 3.2 million metric tons, our capacity roughly expands to 5 million metric tons.

The capacity utilization of that jetty will be very gradual, or you can straight away utilize it at a very high rate?

I don't know when you say high rate, very high rate, what do you mean by that, and when it's very gradual, I don't know what it means. Fundamentally the idea really is that clearly we see more business coming our way on the liquid side.

Our current jetty cannot handle beyond and we have reached the capacity. We need additional capacity to handle larger volumes, also the larger vessels that are coming in the market.

It is a critical component for our customers. I would rather say of course, we are not expecting 3 million metric tons to fill up in the first year or two years, but it'll be a reasonable growth trajectory.

We'll talk about that once the jetty is up and running.

Second question pertains to your arrangement with ONGC, since you are reluctant to share the details, what exactly ONGC is utilizing our infrastructure, what is the arrangement if you can give some broad color, it will be helpful.

From a scope perspective, we are the offshore supply base for ONGC for their installations in the Arabian Sea. They have a large base in Nhava, which has been their traditional and continues to be their largest offshore supply base for the installations in the Arabian Sea.

We provide our jetties for their offshore supply vessels to come and take cargo for these from our port. We also provide them open space and closed warehousing space material that they stock in our port, so that's broadly the scope of activities.

Okay. Thank you.

Thank you. Mr.

Prit Titani, please go ahead.

Thank you for the opportunity, sir. First question would be on the lines of the cost which you have mentioned, CSR and repairs and maintenance.

Can you quantify the amount for both of them?

No, no, not really. I will not be able to split all these details, right, but I have given a major component, right, I think should be fine with that.

Can we say X of this repairs and maintenance and one-off cost of CSR, we would have been able to achieve that 58%, 59% margin which we achieve on a sustainable basis?

That's right. That's right.

Thank you. Second, on the line of container volume growth, are we seeing the container volume growth bottoming out for us, and can we expect future volumes to grow in FY27 and FY28 from the current levels?

As I answered earlier on this call, there is a 7% improvement over previous quarter. However, I would like to wait for one more quarter to see whether this is structural in nature or not.

We would like to comment a little bit more in details in the next quarter results. We will also have two-quarter data points to kind of prompt.

Clearly, there are several initiatives that we initiated with Maersk which are sort of started to yield results. We will see a final this thing in the next quarter results.

Also, some structural improvements in terms of the tariffs, bilateral free trade agreements, bilateral trade agreements are passed. The Suez Canal opening up is in favor of us, we do expect those things to structurally benefit us.

Again, as I said, I think we should wait for one more quarter results to kind of quantify benefits, etc.

Got it. Sir, last question on the line of liquid, we are seeing 0.4 million metric ton million tons of every quarter, and you mentioned that we have a capacity of 1.6 to 1.75, is it fair to assume that we will be in the same level of 0.4 million until December '26?

Broadly, yeah, broadly we should see the four the 400k kind of a number, because that's broadly based on the mix that we are able to do. Maybe 420-ish kind of thing, getting up to 1.7 million, but that's roughly the numbers.

Got it. Last, on the line of margin difference, if you could mention what kind of margins we have in container, fertilizer, liquid, and Ro-Ro?

No, no, we don't share margin split at a business level. Overall EBITDA margins are known, and that's what we would like to kind of maintain.

Got it. Can you just specify the pecking order which has a higher margin followed by--

No, we can't specify any pecking order, please.

Thank you. That's it from my side.

Thank you, sir.

Thank you. Mr.

Jatin Parashar, please go ahead. Jatin Parashar, we can't hear you.

Sorry. Deepankar, you can go ahead in the meanwhile.

Hi. Thank you.

I hope I'm coming through well. Great.

I just had a follow-up question, more of a clarification. You mentioned that you have made some adjustments or some structural changes with Maersk on some of their services, right?

If you could help us understand what kind of changes have you done, which have yielded these positive results sequentially? Secondly, has all the benefit been realized already, or do you expect a further ramp-up?

Sorry. I am not at liberty to share what kind of changes we are doing.

These are all at a customer level, customer level information, commercial information. We will not share that information.

I have already said that we will wait for one more quarter results to kind of get back on more details in terms of how the container volumes are shaping up.

Okay. Fine.

Totally understand. Makes sense as well.

The other question I had was you mentioned that 15% to 25% is the exposure to the US and Europe routes. I think in the past couple of quarters when we spoke about the US headwind, the US tariff headwind, you had mentioned about 10% to 12% of your EXIM containers are on the US-bound routes, I understand that the rest 12% to 15% is from the Europe route.

As far as the rest of the volumes are concerned, they are mainly Middle East volumes, or you have any Far East services? If you could help us understand the geographical exposure, how it stands today?

Most is Far East in nature. I it's very difficult to now it's not in in general that data is I'm not having it handy, but in general, that's more Far East.

Okay. We also have Middle East services, but it's more Far East services, yeah.

Okay. Okay.

Thank you. That is very helpful.

Good luck.

Thank you. Mr.

Jatin Parashar? Can't hear you still.

Prit Titani, you still have some questions?

Just one question. Sir, what you mentioned about the realization of container, liquid, and bulk, what kind of realization is from Ro-Ro?

No, normally don't give the realization for Ro-Ro right now. It's a limited customer, we don't want to share that right now.

Okay. Can we share the revenues for Ro-Ro?

No?

No.

Thank you.

Thank you. Chandini, please go ahead with your questions.

Hi sir. Most of my questions are answered.

Just briefly got disconnected when you are mentioning the realization numbers, any change on that front? Secondly, the trade notice effective of the fourth quarter or the March quarter, right, what would that hike be at a blended level for container or at a portfolio level?

Then are you also planning specific or can we expect similar increases in bulk and liquid as well?

Chandini, very difficult to understand your question. There's a background noise.

Can't understand.

Let me speak a bit louder maybe in that case. Most of my questions are answered, sir.

My only question was on the realization front, I briefly got disconnected when you were answering that. Just trying to understand what the realizations for this quarter were, and that trade notice--

Let me answer one question right now, and then of course you can--

Sure.

On the realization, as I mentioned, no major change on a quarter-on-quarter basis. For container, it is ₹9,500 to ₹10,500 per TEU.

For bulk, it continues to be ₹550 to ₹650 rupees per metric ton. For liquid, ₹550 to ₹600 rupees per metric ton.

Got it, sir. Secondly, for the trade notice that was issued, right, effective of Jan, what would the effect increase at an overall level could be?

Should we link around 5%-6%?

Increase is 5%. Realization, we believe will be in the region of 3% to 4%.

Okay. Can we expect similar hikes for bulk and liquid as well, or should we assume flat realizations there, sir?

We'll let you know when that happens, but marine is an overall increase for everybody.

Sure. Okay.

Thank you, sir, and all the best.

Thank you. Do we have any other follow-up questions from anyone?

Mr. Jatin Parashar, please go ahead.

Sorry, we can't hear you still. Mr.

Parashar, we can't hear you. Any other follow-up questions?

That doesn't seem to be the case. Thank you very much for joining the call.

Thank you, everyone. Thank you.