Buy Allcargo Logistics; target of Rs 142: Motilal Oswal

Motilal Oswal's research report on Allcargo Logistics

Overall revenue increased 22% YoY to INR18.03b v/s our estimate of INR16.6b, led by 22% YoY growth in the MTO segment and 25% growth in the CFS segment. EBITDA increased 20% YoY (-10% QoQ) to INR1.12b, lower than our estimate of INR1.25b. Margins stood at 6.2% (6.3% in 3QFY18). PAT increased 37% YoY to INR477m v/s our estimate of INR642m as the tax rate stood at 38% in 3QFY19 v/s our estimate of 24% (39% in 3QFY18).

Outlook

Valuations of 10.3x/9.2x FY20/21E earnings appear attractive. We value AGLL at 13x FY21E P/E to arrive at a target price of INR142. Maintain Buy.