Buy Mahindra Logistics; target of Rs 630: Sharekhan

Sharekhan's research report on Mahindra Logistics

MLL reported better-than-expected consolidated revenues led by strong growth in its M&M SCM business. OPM slightly lagged due to weak gross margins in the Express and last-mile business. Higher interest and depreciation led to lag on PAT. MLL continues to focus on overall growth through scale and improvement in gross margins in network services especially in Express and last mile. Acquisition of the B2B express business Rivigo is expected to close in couple of weeks with a focus on turning EBITDA positive in the next few quarters.

Outlook

We retain a Buy on Mahindra Logistics Limited (MLL) with a revised PT of Rs. 630, rolling forward our valuation multiple to September 2024 earnings.