Good stock pick which is under 10 rupees. (Hand picked and studied).
Seacoast Shipping Services Ltd has emerged as a promising name in the logistics and shipping industry. With its recent financial growth and strategic market positioning, the company is garnering attention as a potential investment. Let’s take a detailed yet simple look at why Seacoast Shipping Services Ltd is a stock worth considering.
About Seacoast Shipping Services Ltd
Seacoast Shipping Services Ltd, formerly known as Mahaan Impex Limited, was established in 1982 and operates from Ahmedabad, Gujarat. The company specializes in logistics and shipping services, particularly focusing on bulk and container cargo. It has also expanded its offerings to include agro-logistics, tapping into India’s robust agricultural exports market.
The company is listed on both the Bombay Stock Exchange (BSE) and the Calcutta Stock Exchange (CSE), providing it with significant visibility in the financial markets.
Financial Performance
Seacoast Shipping has delivered outstanding financial results, reflecting its operational efficiency and market strength.
Key Financial Highlights (FY 2022-23)
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Revenue: The company reported a total revenue of ₹429.58 crore, a substantial increase from ₹127.81 crore in FY 2021-22. This marks a 236% year-on-year growth.
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Net Profit: Net profit after tax jumped to ₹14.28 crore from ₹2.55 crore in the previous year, showcasing an impressive 460% growth.
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Earnings Per Share (EPS): EPS rose from ₹0.08 in FY 2021-22 to ₹0.42 in FY 2022-23, a 425% increase, which is a positive indicator for shareholders.
Profit Margins
- The company’s profit margin improved from 2.00% in FY 2021-22 to 3.32% in FY 2022-23, indicating better cost control and increased efficiency.
Balance Sheet Highlights
- Authorized Capital: Increased from ₹35 crore to ₹68 crore, reflecting plans for future growth and expansion.
- Reserves: The company added ₹14.28 crore to its reserves, ensuring a strong financial position for future investments.
Historical Financial Metrics
| Year | Asset (₹ Crore) | Liability (₹ Crore) | Ratio | EBDITA (₹ Crore) | Market Cap (₹ Crore) |
|---|---|---|---|---|---|
| 2020 | 3.55 | 0.15 | 23.67 | 15.76 | N/A |
| 2021 | 148.74 | 103.64 | 1.44 | 6.57 | N/A |
| 2022 | 247.62 | 199.91 | 1.24 | 22.82 | N/A |
| 2023 | 152.87 | 90.87 | 1.68 | 35.11 | 219 |
What Makes Seacoast Shipping a Strong Contender?
1. Diversified Offerings
Seacoast Shipping’s entry into agro-logistics complements its core shipping business. This diversification allows it to tap into the growing demand for agricultural exports, thereby reducing reliance on a single revenue stream.
2. Strong Industry Trends
The global shipping and logistics sector is expanding, driven by increased trade and demand for efficient cargo handling. As a key player, Seacoast Shipping is well-positioned to benefit from these tailwinds.
3. Operational Excellence
The company’s focus on cost optimization and service quality has resulted in significant profitability improvements. Its ability to handle complex logistics efficiently makes it a preferred partner in the industry.
Future Growth Projections
Based on its recent performance, here are the potential growth estimates for Seacoast Shipping Services Ltd:
Revenue Projections
- If the company maintains its current growth trajectory, revenues could reach ₹600–₹650 crore in FY 2023-24, driven by expanding market share and new business opportunities.
Profitability Outlook
- Net profit is projected to rise to ₹20–₹25 crore, assuming stable market conditions and continued operational efficiencies.
Earnings Per Share (EPS)
- EPS could grow to ₹0.60–₹0.65, offering enhanced returns to investors.
A Word on Long-Term Investment Strategy
As part of my personal journey of suggesting 1 stock every 3 months for a long-term investment horizon of 10+ years, I have carefully studied Seacoast Shipping Services Ltd. My goal is to identify stocks that could potentially deliver 15x growth over a decade.
For context, my previous pick in 2020 was GE Shipping, which was priced around ₹400 and is now trading at over ₹1000. Similarly, Seacoast Shipping stands out due to its fundamental strengths, including:
- Healthy Asset-to-Liability Ratios: Its balance sheet shows a manageable liability structure, with assets significantly exceeding liabilities in most years.
- Debt-Repayment Capacity: The company demonstrates good financial discipline, ensuring sustainable operations.
- Growth Potential: The expansion into agro-logistics aligns with the increasing demand for agricultural exports.
I would recommend keeping the investment size modest—no more than 1% of your total portfolio. The idea here is to build a diversified portfolio of carefully chosen stocks, each with high growth potential but minimal downside risk.
Disclaimer: Please note that this is not professional investment advice. These analyses are part of my personal hobby, and I am not liable for any losses. Always perform your own research or consult a financial advisor before making investment decisions.
Why Consider Investing?
- Proven Financial Strength: The company’s rapid revenue and profit growth highlight its solid business model.
- Expanding Opportunities: Diversification into agro-logistics positions it for sustained growth in emerging markets.
- Experienced Leadership: The management’s expertise ensures that the company remains agile and competitive in a dynamic industry.
- Long-Term Potential: With a strong balance sheet and strategic expansion plans, Seacoast Shipping is poised for continued success.
In Conclusion
Seacoast Shipping Services Ltd has demonstrated exceptional growth and profitability, making it a standout performer in the logistics sector. Its strategic diversification, robust financial health, and alignment with industry trends make it a compelling investment opportunity for those seeking long-term value.
Whether you’re a seasoned investor or a newcomer to the stock market, Seacoast Shipping Services Ltd offers a promising avenue for growth and returns. Always consult your financial advisor to ensure this aligns with your investment strategy.