{"id":326380,"date":"2024-01-16T18:20:30","date_gmt":"2024-01-16T10:20:30","guid":{"rendered":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/?p=326380"},"modified":"2024-01-16T18:20:31","modified_gmt":"2024-01-16T10:20:31","slug":"stock-in-focus-international-container-terminal-services-inc-ict-16-jan-2024-by-rcbc-securities","status":"publish","type":"post","link":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/stock-in-focus-international-container-terminal-services-inc-ict-16-jan-2024-by-rcbc-securities\/","title":{"rendered":"Stock in Focus: International Container Terminal Services Inc. (ICT) – 16 Jan 2024 by RCBC Securities"},"content":{"rendered":"\n

Summary of Broker’s Recommendation<\/h2>\n\n\n\n
Stock Code<\/strong><\/td>ICT<\/td><\/tr>
Company Name<\/strong><\/td>International Container Terminal Services Inc.<\/td><\/tr>
Broker<\/strong><\/td>AP Securities<\/td><\/tr>
Opinion Issued on<\/strong><\/td>16 Jan 2024<\/td><\/tr>
Recommendation<\/strong><\/td>Buy<\/td><\/tr>
1-Year Target Price<\/strong><\/td>PHP 270.00<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n
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We set our target price (TP) for International Container Terminal Services, Inc. (ICT) at Php270.00 based on DCF. We highlight the company\u2019s resilience against inflation and interest rate hikes. With the expected slowdown in these two factors, ICT\u2019s long-term outlook will only get better, in our view. Our Target Price offers a decent potential upside of 13.9%, which includes a 2024 dividend yield of 4.1%.<\/p>\n\n\n\n

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Analysis and Opinion<\/h2>\n\n\n\n

2024 outlook<\/h3>\n\n\n\n

We expect ICT to continue to improve with the general improvement in economies, following the expected rate cuts and the cooling inflation. For 2024, we expect low-single-digit growth core net income (primarily from expected lower PHP-USD to Php53.00 from Php55.00) to Php35.8 billion. Next year, we project core net income to climb by double-digit (10%) to Php39.3 billion from sustained volumes.<\/p>\n\n\n\n

Bigger things await<\/h3>\n\n\n\n

ICT has been expanding and investing in its port operations. It has agreed to a 25-year joint venture with Transnet Port Terminals (TPT) to build and modernize Durban Container Terminal (DCT) Pier 2, which handles 46% of South Africa\u2019s port traffic.<\/p>\n\n\n\n

Cash cost efficiency leads to resilient margins <\/h3>\n\n\n\n

Despite the increase in ICT\u2019s volumes and revenues, it still managed to have a flat cash opex q\/q. As a result, EBITDA margin was able to improve to 64% in 3Q 2023 from 63% in 2Q 2023. Note that this margin is ICT\u2019s best since 1Q 2022, and even 8bps higher than pre-pandemic (3Q 2019).<\/p>\n\n\n\n

Still looking to grow<\/h3>\n\n\n\n

ICT has submitted a bid to maintain and manage the Iloilo Commercial Port
Complex. The bid is for a 25-year concession agreement with a minimum fixed
fee of Php0.5 billion for the sixth to 10th year and a minimum annual concession fee
of Php0.1 billion for the sixth year.<\/p>\n\n\n\n

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Check how many brokers recommend this stock<\/h2>\n\n\n\n
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All Stock Rankings<\/a><\/blockquote>