Koninklijke Vopak (VPK) Analyst Day 2025 summary

Strategic Developments and Market Position

• AVTL, a joint venture specializing in gas and chemical storage, was successfully listed in India, trading on two stock exchanges with an equity valuation of EUR 2.7 billion.

• The network includes terminals at six major Indian ports with 1.7 million cubic meters capacity, and recent investments are projected to add 590,000 cubic meters.

• AVTL is India's largest independent storage provider for LPG and chemicals, with a diversified customer base exceeding 400, including national oil marketing companies, and strong infrastructure connectivity.

• Vopak's share in AVTL was diluted from 47.31% to 42.23% after the IPO, which involved 10.75% newly issued shares.

• The joint venture focuses on LPG, chemicals, and ammonia, with no intention to enter the oil segment.

Financial Guidance and Capital Allocation

• Total investment in India to date is around EUR 300 million, with an initial EUR 186 million in 2022 and a EUR 121 million growth commitment.

• The IPO generated EUR 290 million in proceeds, to be used for debt repayment and growth capex, and is expected to result in an exceptional dilution gain of EUR 110 million in Q2 results.

• AVTL's contribution to proportional EBITDA was EUR 26 million in 2024.

• The joint venture is now debt-free, freeing up capital for alternative strategic initiatives and potential shareholder distributions.

• A shareholder loan of EUR 45 million is expected to be repaid to Vopak, pending regulatory approval.

Growth Strategy and Future Plans

• India’s economic growth and rising energy demand are driving significant opportunities for storage infrastructure, with LPG imports growing at a 10.9% CAGR from 2014 to 2024.

• Organic growth is prioritized, with greenfield investments in LPG, chemicals, and ammonia offering attractive returns at low EBITDA multiples.

• The IPO enables AVTL to fund future growth directly from Indian sources, reducing the need for further shareholder loans.

• Acquisitions remain a possibility, especially given favorable trading multiples in India, but organic expansion is currently the main focus.

• AVTL must achieve a 25% free float within three years of the IPO, with further share issuances or potential sell-downs to meet this requirement.