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Buy Transport Corporation of India; target of Rs 880 : Motilal Oswal

Motilal Oswal is bullish on Transport Corporation of India recommended buy rating on the stock with a target price of Rs 880 in its research report dated April 05, 2022.

April 06, 2022 / 01:44 PM IST
 
 
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Motilal Oswal's research report on Transport Corporation of India


TCI has developed robust capabilities in multimodal Logistics via its presence across major transportation modes. The company has well-diversified service offerings from Road freight, integrated Supply Chain solutions, Sea freight, to a JV with CONCOR for Rail freight. These capabilities would be a key enabler for consistent growth in volumes and earnings for TCI over the next few years. With an improving share of the Seaways segment, margin is expected to remain at elevated levels. The company has contracts in place with customers for passing on the increase in diesel prices. With strong volumes, a rise in freight rates may be seamless. The impact of a diesel price increase on margin is also expected to be minimal. TCI is a long-term play, backed by: a) a diversified clientele base, b) improving share in the high-margin Less than Truck Load (LTL) business in the Road Freight division, c) strong presence in the high growth 3PL segment, and d) rising contribution from the high margin Seaways segment.



Outlook


We expect TCI to clock a revenue/EBITDA/PAT CAGR of ~18/28%/36% over FY21-24E. We reiterate our Buy rating on the stock with a TP of INR880.

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At 13:40 hrs Transport Corporation of India was quoting at Rs 643.95, up Rs 18.75, or 3.00 percent.


It has touched an intraday high of Rs 647.00 and an intraday low of Rs 627.45.


It was trading with volumes of 16,350 shares, compared to its thirty day average of 16,361 shares, a decrease of -0.06 percent.


In the previous trading session, the share closed down 0.24 percent or Rs 1.50 at Rs 625.20.


The share touched its 52-week high Rs 858.00 and 52-week low Rs 253.85 on 17 January, 2022 and 13 April, 2021, respectively.


Currently, it is trading 24.95 percent below its 52-week high and 153.67 percent above its 52-week low.


Market capitalisation stands at Rs 4,979.53 crore.


For all recommendations report, click here


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first published: Apr 6, 2022 01:44 pm
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