Aegis Logistics Share price and Fundamental Analysis

Company History

Aegis Logistics Limited is in the business of import and distribution of Liquified Petroleum Gas (LPG) and storage and terminalling facility for LPG and chemical products. The Company operate storage facilities at Mumbai, Haldia, Pipavav and Mangalore. The Aegis Group captures the complete logistics value chain starting from sourcing, terminalling to retail distribution of LPG.

Aegis Logistics is a leader in Oil, Gas and Chemical Logistics. The company is engaged in providing logistic solutions for Oil, Gas, Chemicals and Petrochemical Industries. With their strategic locations and indispensable services, Aegis is a key supplier for total supply chain management services to major customers including Oil PSUs.

Aegis Logistics Ltd was incorporated on June 30, 1956 as a private limited company with the name Atul Drug House Ltd. In the year 1962, the company installed their first plant for the manufacture of formaldehyde and hexamine at Kandla. In the year 1967, they installed another plant at Capi near Bulsar in Gujarat State for the manufacture of 14,400 tonnes of formaldehyde and 540 tonnes of hexamine per annum.

In the year 1970, the company installed at Vapi a plant for the manufacture of Pentaerythritol formaldehyde with a capacity of 1,200 tonnes per annum with the technical know-how supplied by Joset Meissner of W.Germany. In September 14, 1976, the name of the company was changed to Atul Chemical Industries Ltd. Also, they became a public limited company.

The name of the company was again changed from Atul Chemical Industries Ltd to Aegis Logistics Ltd. In the year 1999, the Petrochemicals Division was hived off to Perstorp Aegis Chemicals Ltd, (PACL) a joint venture company between the company and Perstorp AB, Netherlands.

During the year 2007-08, as per the scheme of arrangement (SoA), Throughput Activity Undertaking of Hindustan Aegis LPG Ltd was de-merged and transferred to the company with effect from the appointed date, April 01, 2007. During the year 2008-09, Tapi Finvest India Pvt Ltd was amalgamated with the company.

During the year 2009-10, the company entered into a strategic alliance with Essar Oil Ltd, which entails a reciprocal arrangement wherein both the companies would sell each other fuels through their retail outlets.

In April 1, 2010, the company acquired 100% shareholding in Shell Gas (LPG) India Pvt Ltd. Consequently; SGLIPL became wholly owned subsidiary with effect from April 1, 2010. Also, the name of SCLIPL was changed to Aegis Gas (LPG) Pvt Ltd (AGPL).

During the year 2010-11, the company was awarded the Operations & Maintenance (O&M) contract for the product storage and dispatch operations of Bharat Oman Refinery Ltd (BORL) at Bina in Madhya Pradesh signifying the Aegis expertise of the company in Liquid Logistic and Operations & Maintenance. Also, Aegis Gas (LPG) Pvt Ltd (AGPL), the wholly owned subsidiary of the company acquired 100% equity shares of Hindustan Aegis LPG Ltd (HAL PG), from its erstwhile shareholders. Consequently, HAL PG ceased to be an associate and became a wholly owned subsidiary of AGPL.

In November 2010, the company entered into a major deal with APM Terminals Pipavav to avail on sub-lease close to 100 acres of land for building a global oil and petrochemicals storage complex. The company will invest up to Rs 400 crore ($90m) in building a 600,000 KL oil terminal complex in Port Pipavav. With the announcement of this project, the company's liquids capacity will rise from 300,000 KL to over 1 million KL.

In February 2013, Aegis Logistics initiated the Pipavav - Phase I Greenfield project to set up a liquid terminal of 1,20,000 KL and double storage capacity of the pressurized gases terminal to 5,400 MT.

During the financial year ended 31 March 2014, Aegis Logistics' terminalling business benefitted from investments made in the previous year in the liquid terminals business, ranging from de-bottlenecking to commissioning of the new terminal at Haldia Dock Complex. Towards the end of the year, the company partially commissioned the liquid terminal at Pipavav Port with the balance of the expansion of liquid terminal as well as the gas terminal expected to be completed by the end of 2014.

During the year under review, the performance of the company's gas retail and distribution business was lower due to a slowdown in the growth rate of the retail LPG business as government policy on LPG subsidies fluctuated. The LPG sourcing and terminalling business improved largely due to higher off take by national oil companies during the year.

During the financial year ended 31 March 2015, Aegis Logistics established a joint venture with ITOCHU Corporation of Japan. In furtherance to the same, the company sold 8,538 equity shares, representing 40% of the outstanding shares of Aegis Group International Pte. Ltd. (AGI), its wholly owned subsidiary in Singapore, to Itochu Petroleum Co. (Singapore) Pte. Ltd., a wholly owned subsidiary of ITOCHU Corporation. As a part of the proposed transaction, the parties executed a Shareholders Agreement and Share Purchase Agreement by and between the company, AGI and Itochu Petroleum Co., (Singapore) Pte. Ltd. for sale and transfer of 8,538 equity shares of USD 1 held by the company in AGI at an aggregate consideration of US$ 5,850,000. The Shareholders Agreement inter alia granted a right to Itochu Petroleum Co., (Singapore) Pte Ltd., for a period of six years, to purchase 40% stake in the existing and new LPG Terminals of the Aegis Group, subject to commercial negotiations on valuation. ITOCHU Corporation is one of the largest global LPG companies by sales volume and a key global player in the segment. The entry of a new strategic partner is aimed at raising the market share of AGI in India's imports by following a strategy of attaining cost leadership in the LPG import market.

During the year under review, Aegis Logistics' Bulk Liquid Terminal continued operations at full capacity. During the year under review, Aegis Logistics' wholly owned subsidiary Aegis Gas (LPG) Private Limited commissioned its Liquid Storage Terminal with a capacity of 120,000 KL and doubled its Gas Storage Terminal capacity to 5400 MT.

During the year under review Aegis Logistics benefited from the capital investments made in the previous financial year at Haldia and Pipavav. The company's terminalling business benefited from near full capacity utilization at its facilities in Haldia, an increase in business at the Kochi terminal and commissioning of operation of the Pipavav terminal. The performance of the gas retail and distribution business stabilized with the gradual rationalization of LPG subsidies, resulting in a decrease in the diversion of subsidized LPG to the transport and commercial sector.

During the year under review, the company's Liquid Logistics Division won several new contracts, including six inland terminals for Hindustan Petroleum and the Marine Oil Terminal at Jawahar Deep. The business division demonstrated its logistics expertise by offioading bulk liquid cargo via ship to shore pipelines into its storage tanks, refilled the product into ISO containers, and transported them by rail to the customer's facilities several hundred kilometres away, thereby delivering a cost effective logistics solution to the customer. LPG distribution volumes declined compared with the previous year, mainly due to the illegal diversion of subsidized LPG to this sector.

During the year under review, Aegis Logistics fully redeemed 250 units of 9.75% Secured, Taxable, Redeemable, Non-Convertible Debentures of face value of Rs. 10 lacs each totaling to Rs. 25 crores maturing on put option exercised by Corporation Bank.

During the financial year ended 31 March 2016, Aegis Logistics benefited from the capital investments in new LPG capacity made in the previous financial year at Pipavav and from operational improvements at the Mumbai LPG terminal. This resulted in an excellent performance in the company's gas terminalling business. The company's liquid terminalling business benefited from full capacity utilization at its facilities in Haldia, high capacity utilisation at the Kochi terminal and better utilisation of the Pipavav liquids terminal. The gas terminalling business performed extremely well with the addition of Indian Oil Corporation as a key customer, with record throughput of LPG at both Pipavav and Mumbai. Sourcing volumes were lower due to delays in the registration of Aegis Group International Pte. Ltd. (AGI) as an approved international vendor. With the rationalization of LPG subsidies resulting in a decrease in the diversion of subsidized LPG to the transport and commercial sector, the volume performance of the gas retail and distribution business improved by 15%, with a commensurate rise in gross margins.

During the year under review, the company's Liquid Logistics Division recorded all time revenue of Rs 170.60 crore. Normalized EBITDA of the division was also at a record of Rs. 102.38 crore for the year. The Mumbai terminals benefited from the commissioning of the second chemical berth at Pir Pau with faster turnaround of vessels.

During the financial year ended 31 March 2017, Aegis Logistics embarked on a further expansion of its LPG storage capacity in Pipavav from 8,100 MT to 18,300 MT, an increase of 10,300 MT.

During the year under review, the company's bulk liquid terminal continued operations at full capacity. During the year, Aegis Logistics provided an Exit Offer to the shareholders of its subsidiary Sea Lord Containers Limited pursuant to Securities Exchange Board of India (SEBI) Circular No. SEBI/HO/MRD/DSA/CIR/P/2016/110 dated October 10, 2016. As on 31 March 2017, the company holds 92.26% Equity Shares of Sea Lord Containers Limited. Further, during the financial year F.Y. 2016-17, Sea Lord Containers Limited redeemed its entire Non-Cumulative Redeemable Preference Shares aggregating to Rs. 38 crore held by Aegis Logistics. During the year under review, the liquid storage terminal undertaking of Aegis Logistics' wholly owned subsidiary Aegis Gas (LPG) Private Limited located at Pipavav Port along with all assets and liabilities was acquired by Aegis Logistics.During the year, the under review LPG Assets at Haldia Dock Complex, West Bengal of Aegis Logistics was transferred to its wholly owned subsidiary Hindustan Aegis LPG Limited. During the year review, Aegis Logistics further invested USD 20,000, at par in its wholly owned subsidiary Aegis International Marine Services Pte. Limited for its working capital needs. During the year under review, Aegis Logistics benefited from the capital investments in new LPG capacity made in the previous financial year at Pipavav and from operational improvements at the Mumbai LPG terminal. This resulted in an excellent performance in the company's gas terminalling business. The liquid terminalling business of the company benefited from full capacity utilization at its facilities in Haldia and higher capacity utilisation at the Kochi terminal, but the Pipavav liquids terminal remained under-utilized. The gas terminalling business performed extremely well with the addition of Indian Oil Corporation as a key customer, with record throughput of LPG at both Pipavav and Mumbai. Sourcing volumes were excellent and doubled from last year. With the rationalization of LPG subsidies resulting in a decrease in the diversion of subsidized LPG to the transport and commercial sector, the volume performance of the gas retail and distribution business also improved significantly.

During the year under review, sourcing volumes of the company's LPG division improved markedly due to the sharp increase in demand driven by the successful implementation of the LPG Subsidy Pahal (DBTL) Scheme in rural areas, and gas throughput volumes increased significantly at both Mumbai and Pipavav on the back of this demand. Distribution volumes also improved compared with the previous year. The commissioning of an additional 2700 MT of LPG storage capacity at Pipavav during 2016-17 and the operational debottlenecking at the Mumbai LPG terminal contributed to the significant rise in throughput of LPG during FY 2017.

Aegis Logistics' subsidiary company Hindustan Aegis LPG Limited commissioned a fully refrigerated LPG terminal at Haldia Dock Complex, West Bengal in Q3 FY 2018, with a static storage capacity of 25,000 MT and throughput capacity of 2,500,000 MT per annum. This is the largest LPG terminal in the Aegis portfolio. During the ended 31 March 2018, Aegis Logistics completed its project of debottlenecking of Mumbai LPG terminal by connecting it by pipeline to the Uran-Chakan cross country LPG pipeline. During the year under review, the company's bulk liquid terminal continued operations at full capacity.

During the year under review, Aegis Logistics' wholly owned subsidiary Aegis Gas (LPG) Private Limited expanded its LPG storage capacity in Pipavav from 8,100 MT to 18,300 MT, an increase of 10,200 MT. It has also redeemed all its outstanding Non - Convertible debentures which were listed on National Stock Exchange of India Ltd. During the year, Itochu Petroleum Co. (Singapore) Pte. Ltd., a Singapore based company, subscribed to 19.7% stake in the equity capital of Aegis Logistics' subsidiary company Hindustan Aegis LPG Limited through Preferential Issue.

During the year under review, Aegis Logistics' gas terminalling business performed extremely well with the addition excellent throughput at both Pipavav and Mumbai, and with initial throughput at Haldia.

During the year 2018-19, the Aegis Logistics Limited which held 92.46% of equity shares of Sea Lord Containers Limited, in compliance with the provisions of section 236 of the Companies Act, 2013 dispatched the respective consideration amount to all the minority public shareholders of the Company and acquired remaining equity shares aggregating 7.54 % of the total share capital of the Company. Accordingly, the Company has become the wholly owned subsidiary of the Aegis Logistics Limited with effect from December 31, 2018.

The Company had during the year 2019 approved the setting up of additional liquid tankage with the storage capacity of 40,000 KL, beyond the existing 1,00,000 KL storage capacity at Kandla Port.

The Company during the year 2020 approved setting up a new LPG terminal of a capacity of 45,000 MT at Kandla which is in progress and expected to be completed by First half of FY 2021.

In FY 2022, the Company had approved setting up of an additional storage capacity of 50,000 KL over and above existing 25,000 KL of bulk liquid terminals at Mangalore, which has now been commissioned during the year.

Through its subsidiary Company, Konkan Storage Systems (KOCHI) Private Limited, the Company had approved an addition of 20,000 KL of bulk liquid tankage beyond the existing 51,000 KL at Kochi Port, , which is expected to be completed during the year 2022.

The Kandla LPG terminal with a static capacity of 48,000 MT and throughput capacity of 40,00,000 MT (at full utilisation) has been completed and commissioned during the year 2022. The Company through its subsidiary Aegis Gas (LPG) Private Limited is expecting completion of expansion of its existing 18,300 MT capacity of LPG Terminals by additional 3,800 MT capacity during the next year.

The expansion of 54,500 KL of bulk liquid terminals at Haldia over and above the existing capacity of 1,20,000 KL has been commissioned and completed during the year 2022.

Through its subsidiary Aegis Gas (LPG) Private Limited, the Company has commissioned LPG railway gantry which is fully operational. The Company through its subsidiary Aegis Gas (LPG) Private Limited has significant growth plans in Retail LPG distribution business such as Commercial LPG Market under the brand name 'Aegis Puregas & Magna' brand and Domestic LPG Market under 'Aegis Chota Cikandar' brand on a national scale.

The Board has during the year 2022 approved to add 175,000 kilo liters of liquid storage capacity and 100,000 MT of gas storage capacity at a capital expenditure of about Rs. 1,250 Crores.

During the year 2022, Company had invested INR 5,00,000 in cash in the shares of Aegis Vopak Terminals Limited (AVTL), by acquisition of 100% stake from its wholly owned subsidiary, Aegis Gas (LPG) Private Limited. Pursuant to the same, AVTL had become wholly owned subsidiary of the Company. Further, Company invested Rs. 56,00,000/- in cash to increase stake in AVTL by way of acquiring 4,60,000 equity shares of Rs. 10/- each and 1,00,000 Compulsory Convertible preference shares of Rs. 10/- each.

During the year 2022, Company had entered into Shareholder's Agreement (SHA) and simultaneously with the execution of Shareholder's Agreement, Share Subscription Agreement (SSA) with Vopak India B.V. and Company's wholly owned subsidiary, Aegis Vopak Terminals Limited (AVTL) (including amendment agreements to SHA and SSA), wherein AVTL had agreed to issue to Vopak, and Vopak, has agreed to subscribe to, the subscription shares, such that upon completion of the subscription to shares pursuant to the SSA, the Company shall hold the legal and beneficial ownership to 51% of the share capital of AVTL and Vopak shall hold the legal and beneficial ownership to 49% of the share capital of AVTL.

During the year 2022, Company has entered into Share Purchase Agreement with Vopak India B.V., Vopak Asia Pte. Limited, Vopak Logistics Asia Pacific B.V., CRL Terminals Private Limited, Aegis Vopak Terminals Limited (AVTL) [Formerly known as Aegis LPG Logistics (Pipavav) Limited] wherein Vopak India, Vopak Asia and Vopak Logistics (collectively, Sellers) have agreed to transfer to AVTL, the 100% equity shares of CRL Terminals.

During the year 2022, Company has entered into Business Transfer Agreements to transfer following business undertakings to Aegis Vopak Terminals Limited, its wholly owned subsidiary by way of slump sale as a going concern basis: 1. Transfer of liquid storage units of the Company located at Haldia Dock Complex, MouzaChiranjibpur,; 2. Transfer of liquid and LPG storage units of the Company, located within the limits of the Kandla Port Trust in Gandhidham, Gujarat; 3. Transfer of liquid storage unit of the Company located within the limits of the liquid storage unit of the Company located at Dakshina Kannada, Mangalore; 4. Transfer of liquid storage unit of the Company located within the limits of the Port of Pipavav, in Gujarat.

During the year 2022, Company's wholly owned subsidiary Aegis Gas (LPG) Private Limited entered into Business Transfer Agreement to transfer Pipavav LPG storage units located within the limits of the Port of Pipavav, Gujarat by way of slump sale basis to Aegis Vopak Terminals Limited.

During the year 2022, Company, through Aegis Vopak Terminals Limited (AVTL), had has signed definitive agreements to acquire assets pertaining to liquid tank terminals with capacity of 500,000 KL at Kandla Port from Friends Group for total outlay of Rs. 265 crore.

During the year 2022, Company had sold entire equity holding representing 100% equity stake of Konkan Storage Systems (Kochi) Private Limited (KCPL), its wholly owned subsidiary to Aegis Vopak Terminals Limited (AVTL) at fair value of Rs. 18.5/- per equity share aggregating to Rs. 18,50,000. As on March 31, 2022, KCPL had become a step down subsidiary of the Company and wholly owned subsidiary of AVTL.

During FY 2022-23, the new LPG terminal at Kandla Unit was made operational. Pipavav LPG Bottling Plant was commissioned. Liquid terminals expansion of 50,000 kilolitres at Haldia was commissioned. A New LPG Jetty Pipeline was commissioned.

The Company and its subsidiary AVTL had entered into Business Transfer Agreements (BTA) for transfer of LPG and Liquid storage business at Kandla, and Liquid storage business at Pipavav, Mangalore and Haldia to AVTL, which got completed on May 20, 2022.