Buy VRL Logistics; target of Rs 850: Motilal Oswal

Motilal Oswal is bullish on VRL Logistics recommended buy rating on the stock with a target price of Rs 850 in its research report dated July 19, 2023.

Broker Research

July 20, 2023 / 12:51 IST

Buy

26 Aug, 2025 12:21

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Motilal Oswal's research report on VRL Logistics

VRLL, with its large asset base of 5,671 trucks, has successfully transformed itself into a specialized goods transport (GT) company by focusing on its highmargin LTL (less than truck load) segment. In FY23, VRLL expanded its branch network by adding 184 new branches, which led to a significant increase in volumes. To capitalize on the growth opportunity in the LTL segment, VRLL has placed orders for 1,667 GT vehicles at a capex of INR6.97b. The fleet expansion will increase the company’s capacity by ~30,000 tonnes. Currently, the trucks have a total carrying capacity of 82,657 tonnes. The company's customer base grew to ~0.8m in Mar’23 from ~0.7m in Mar’22. With growing demand for a logistics partner with a nationwide footprint, VRLL is in a favourable position to attract large customers. In addition, VRLL has a comprehensive infrastructure setup, which includes various owned facilities such as branches, offices, and transshipment hubs.

Outlook

We expect the company to post a revenue/EBITDA/PAT CAGR of 19%/25%/36% over FY23-25. We reiterate our BUY rating with a TP of INR850 (based on 24x FY25E EPS).

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