Motilal Oswal has given Buy on the stock with a revised price target (PT) recommendation for VRL Logistics with a target price of Rs. lal Oswal is bullish on VRL Logistics has recommended buy on the stock with a revised price target (PT) of Rs. 690 in its research report issued on Feb 03, 2022

Outlook

EBITDA margin jumped 122bp QoQ to 19%, v/s our estimate of 17%, driven by a sharp cut in diesel prices in Nov’21 (due to a cut in the tax rate on fuel). EBITDA rose 31% YoY to INR 1.3b (22% beat). EBITDA for Bus Operations turned positive with a rise in occupancies and realization. Strong operating performance and lower tax outgo saw APAT grow 52% YoY to INR 605m. We raise our FY23E/FY24E EPS by 21%/19% to factor in an improved outlook on volume and margin. Robust improvement in Bus segment to support profitability for VRL. We maintain our BUY rating on the stock with a revised TP of INR 690 (premised on 30x FY24E EPS), implying 38% upside potential.

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