Shares of Container Corporation of India (CONCOR) Ltd. fell nearly 5 percent on Tuesday after Kotak Institutional Equities downgraded the state-run firm to sell from reduce. It has kept its price target unchanged at Rs 610 per share.

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The brokerage said that the company is entering a ‘zone of margin correction and uncertainty’.

Data from industry sources suggested that the company took a price cut of 8-9 percent in exports of 20 metric tonnes weight category across its key ports from May 1, 2023, Kotak Institutional Equities said in its research note.

Further, the company has taken a higher, but selective 12 percent cut in export pricing at the Pipavav Port. This was the first such instance of a meaningful pricing cut by the company over the past five years, it added.

Such a move is reducing the premium Concor charges to the key competitors, the broking firm observed.

Kotak Institutional Equities believes that change in CMD from October 2023 creates scope for accelerating price cuts.

Further, competitive pressure from peers such as GRFL and Adani Logistics will only increase for Concor.

In September 2022, Kotak downgraded Concor to "reduce" from "add" saying that the revised railway land license policy is negative as compared to its expectations.

The public sector transport handled total cargo volume of 43,61,131 Twenty Foot Equivalent Units (TEUs) in the financial year 2022-23 (FY23), which is 7.08 percent higher than 40,72,925 TEUs it handled in financial year 2022.

Shares of CONCOR ended 3.55 percent lower at Rs 637.50. The stock is down 14 percent on a year-to-date basis.