TransContainer

Moscow: TRCN

RUB119217.1m market cap

RUB8580 last close

TransContainer owns and operates rail freight assets across Russia. Its assets comprise rail flatcars, handling terminals and trucks, through which it provides integrated end-to-end freight forwarding services to its customers.

Investment summary

Both cyclical and structural factors drove strong revenue growth in H119 (adjusted revenues up 32% y-o-y, above our expectations) which, combined with efficiency gains and economies of scale, led to EBITDA growth of 67% y-o-y and net income almost doubling. We forecast growth to continue, albeit at a more moderate pace, as we expect a stabilisation in rail container transportation prices. We have significantly increased our forecasts, which drives a 33% increase in our valuation to RUB9,460/share.

Y/E Dec
Revenue (RUBm)
EBITDA (RUBm)
PBT (RUBm)
EPS (fd) (RUB)
P/E (x)
P/CF (x)
2017A 27782.0 10252.0 8147.0 448.2 1914.3 1117.7
2018A 31288.0 13342.0 10263.0 560.9 1529.7 835.9
2019E 40229.0 21542.0 17248.0 983.9 872.0 530.4
2020E 47858.0 27599.0 22021.0 1252.0 685.3 415.3
Industry outlook

Containerisation is a structural trend for the Russian market and should support revenue and profit growth for TransContainer, in our view. Currently, only c 7% of Russia’s potentially containerisable rail cargo is transported in containers and, although this figure rose from 2.2% in 2001, it is still much lower than in the US (18%), India (16%) and Europe (14%).

Last updated on 11/11/2019
Sector
Industrials
Share price graph
Balance sheet
Forecast net debt (RUBm) 7661
Forecast gearing ratio (%) 14
Price performance
%
1m
3m
12m
Actual 2.0 20.0 93.2
Relative* (6.7) 8.6 56.8
52-week high/low RUB9025.0/RUB4300.0
*% relative to local index
Key management
Alexander Shakhanov Deputy Director for Capital Markets & IR