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Strong container led operating performance

We expect our Ports coverage universe to report Revenue/EBITDA/PAT growth of ~17%/17%/26% YoY (3%/2%/3% QoQ) in Q3FY26, led by healthy volume momentum and improving mix, particularly at ADSEZ. ADSEZ is expected to deliver strong operational performance, supported by sustained container-led growth and continued ramp-up at new sites viz. Vizhinjam & CWIT, driving better realizations and profitability. In contrast, JSWINFRA’s Q3 performance is likely to be impacted by higher share of terminal revenues commanding lower margins although there is recovery in volumes at Paradip. Improving volumes at other legacy ports and better realizations should partially cushion this impact, as Q4 is expected to be seasonally stronger.

With multiple expansion projects and port-linked logistics capacities gradually coming onstream, the sector remains well positioned over the medium term. Strong volume growth and better NSR led by higher container volumes to aid ADSEZ while a favorable mix from better-priced ports should support JSWINFRA. Moreover, Q4 is expected to be seasonally stronger, providing additional support to volumes and earnings. Top Pick: ADSEZ

ADSEZ to sustain strong volume momentum:

* ADSEZ has reported strong volume growth (9.6% YoY) in Q3FY26, led by container volumes across Mundra, Vizhinjam and Colombo West International Terminal (CWIT). Thermal coal volumes are expected to be higher both QoQ and YoY, supporting overall cargo growth. Marine and logistics businesses are also expected to post healthy sequential revenue growth, aided by higher fleet utilization and expanding rail and inland logistics operations. We expect ADSEZ to deliver 18% YoY (2.1% QoQ) growth in EBITDA led by higher container volumes.

* JSWINFRA is expected to deliver ~7% YoY volume growth in Q3FY26, supported by better throughput at legacy ports such as Jaigarh and Dharamtar, along with improved volumes at JNPA and Tuticorin. Paradip iron ore and coal terminal volumes were under pressure during the quarter; however, December showed an improvement in throughput, which should lead to better volumes in Q4FY26. EBITDA margins for JSWINFRA are expected to decline to ~46% in Q3FY26 due to a higher share of sales from terminals (having higher royalties) commanding lower margins.

JSWINFRA’s NSR to aid performance:

* JSW’s NSR is expected to increase by ~3% QoQ (+9% YoY) to Rs393/t, driven by a higher share of better-priced volumes from Jaigarh and Dharamtar, partially offsetting weakness at Paradip. Southwest Port volumes are expected to improve as the impact of the Vijaynagar blast furnace shutdown is largely offset by the ramp-up at JVML.

* Similarly, we expect ADSEZ’s NSR to improve by ~3% QoQ to Rs444/t (-5% YoY), driven by a higher share of container volumes, particularly from Mundra, Vizhinjam and CWIT.

Logistics segment to continue scaling up across both players:

* ADSEZ’s logistics and marine businesses are expected to deliver strong sequential growth, with sharp increase expected in revenue. This reflects continued ramp up in rail, trucking, ICDs, and international freight, reinforcing ADSEZ’s integrated transport utility strategy.

* JSWINFRA’s logistics business is expected to scale up further led by focus on building various logistics verticals along with Navkar corporation which was reflected in various acquisitions done by the company under this segment. We expect 10% QoQ (+50% YoY) growth in its logistics business. We believe scale benefits and improving utilization should support medium-term profitability.

Change in Estimates For JSWINFRA we cut our EBITDA estimates by 2%/3%/3% for FY26/27/28E to accommodate higher royalties at terminals and weaker near-term volume growth and expect EBITDA CAGR of ~23% over FY25-28E. At CMP, the stock is trading at 20.9x/16.2x EV of FY27/FY28E EBITDA. Maintain ‘BUY’ with revised TP of Rs324 (earlier Rs336) valuing at 21x EV of Sep’27E EBITDA.

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