Motilal Oswal has given Buy recommendation for VRL Logistics recommended buy rating on the stock with a target price of Rs 580 in its research re with a target price of Rs. 580 in its research report issued on Jan 28, 2022

Motilal Oswal’s research report on VRL Logistics

VRL Logistics (VRL) is an established logistics operator primarily focusing on the high-margin LTL segment (90% contribution from LTL and 10% from FTL in FY21). VRL is one of the largest asset owners in the industry and is well placed to capitalize on the growth opportunity presented by the logistics sector. VRL derived ~90% of its business from the Goods Transport (GT) segment, followed by 7% contribution from the Passenger Bus Service segment in FY21. Unlike its peers, VRL operated its own fleet of 4,687 trucks (capacity: 69,011t) and 280 buses at end-2QFY22. VRL uses biodiesel (15-25% of its fuel requirement) which helps it reduce fuel costs by INR3-4 per liter. Being the owner of a large fleet, VRL is able to negotiate for spare parts and maintenance-related costs better and provide enhanced service to its well-diversified client base. With robust volumes, expanding branch network and the improved cost efficiency measures, we expect VRL to clock a revenue/EBITDA/PAT CAGR of ~19%/22%/56%, respectively, over FY21–24.


We reiterate our BUY rating on the stock with a TP of INR580 premised on 30x FY24E EPS, implying 33% potential upside.

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At 17:30 VRL Logistics was quoting at Rs 479.60, up Rs 35.35, or 7.96 percent.

It has touched an intraday high of Rs 491.00 and an intraday low of Rs 443.10.

It was trading with volumes of 31,003 shares, compared to its thirty day average of 14,938 shares, an increase of 107.55 percent.

In the previous trading session, the share closed up 0.66 percent or Rs 2.90 at Rs 444.25.

The share touched its 52-week high Rs 534.00 and 52-week low Rs 188.55 on 11 November, 2021 and 01 February, 2021, respectively.

Currently, it is trading 10.19 percent below its 52-week high and 154.36 percent above its 52-week low.

Market capitalisation stands at Rs 4,236.95 crore.

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