Uttrayan tgt was only 480,but MahLog trading 540+.....
indeed a crazy bull mkt. Now only left behind is FSC !!
SubsidiarieS :
2*2 logistics, Lords fright
Earlier were loss making but in last 3, 6 mnths made profit !!
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Peers : no exact comparable but still nearly peers
............... . M.cap...... PE..... 5 yr CAGR....mcap/sales
TCI.......... 2130cr........30..........0%....1.10
All cargo...4100cr.......20.........6%.....0.75
Vrl........... 3200cr........43.........11%.... 1.8
MLL.........3052cr.........64........18%....1.14
Above taken only consideration of m.cap similarity
Other logistics player trading,
Aegis 64PE , Allcargo 18PE(good pick for med term! )
Avg logistics ind PE : 52.8
So, price band is not much high if see overall picture,
Mahindra other group share,
Mahindra CiE trading much higher PE ratio than its peer,so this one may also !!
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Valuation :
Profit margin : 1.7%(big negative)
5 yr PAT caGr,income CaGr :18%, 15%
3 yr PAT cagR, income CagR: 17%,11%
2016-18 PAT,income CagR(expected) : 23%,25%
@429, 2017 PE 64,
2018 Q1 EPS 2.18, Estimated 7.5-9
Take 8 rs => 2018 PE : 53
Ind PE 53,but taking consideration of good growth,strong group, enrich mkt conditions, much more business opportunity to grow than former logistics company we may give xtra 5 PE to this one,
58*8 = 464(listing tgt)
60*8 = 480( till uttrayan)
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Favorable statements:
Overall logistics ind to grow 13% caGr in nxt 3 yr, while 3PL ind to grow 21%cagr,
So good opportunity for mahindra logistics to use this growth and unlock it''''s true value.
If MLL can increase PAT margin just near 3% in coming yrs(After GST seems possible) , then MLL has set price band 30PE of 2019(attractive)!!
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Allotment :
Nearly 1.97L forms reqd for 1x
Due to Nippon, khadim,niA and virtually higher price band expecting only 6-7L or below forms,
Allotment ratio may : 1/3 (Fair possibility/ almost confirmed, linkintime ????)
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Concl.......
Subscribe for short mid long term ,possible listing gain 1-1.5 FD!
For listing gain confirmation you may wait till 3rd day 1.30pm(to check subsc fig) or till SPT says avoid!!!
M applying in any cases.
Note : GMP going down steadily with low volume , may only stabilise near 20-25!!
Zerodha (Trading Account)
RHP
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