Mahindra Logistics IPO Details

Company Profile:

Mahindra Logistics is the India largest Third party logistics services provider.The company two business segments are supply chain management and people transport solutions.The core supply chain management has a large network of over 1,000 business partners providing vehicles,warehouse and the other assets and services and and counts Volkswagan India,Vodafone Indai,Thermax,and JSW Steel among biggest client 

              Issue Highlights 

Subscription	31 Oct - 2 Nov 2017
IPO Closing Date	2 November 2017
Total IPO size	19,332,346 shares
Issue Price	Rs 425 - 429
Market Lot	34 Shares
Face Value	10
Proposed List Platform	NSE,BSE

               Company Financials:

Particulars	Year Ended (Rs. in Crore)
	31.03.2016	31.03.2017
Share capital Reserves and Surplus Shareholders’ funds Revenue from Operations Other income Total Revenue Total expense Profit after tax EPS PE Ratio	59.82 262.22 322.04 2064.10 13.02 2077.12 2021.32 35.87 5.36 80.03	67.99 294.67 362.66 2666.68 9.57 2676.25 2608.43 46.10 6.71 63.94

Strengths:

Mahindra Logistics reported a 28.5% rise in PAT for FY 2017. The PAT increased from Rs. 35.87 Cr in FY 2016 to Rs. 46.10 Cr . 

 The “asset-light” business model of the company helps to reduce capital expenditure requirements, mitigate the effects of operational risks relating to direct fuel costs, maintenance costs and depreciation in addition to reducing the effect of any risks emanating from changes in laws and regulations. 

The implementation of GST to lead more organized logistics service providers to provide end-to-end logistics solutions and have a pan-India presence. This leads to removal of check posts hence result in faster travelling time, lower freight costs and timely delivery of goods. 

The CRISIL Report has estimated the 3rd Party Logistics market in India at Rs. 325- 335 billion in Fiscal 2017, which is expected to growat a CAGR of 19-21% to reach Rs.570-580 billion by Fiscal 2020.

Recommendation:

Mahindra Logistics one of the organised player in 3rd Party Logistics business in india supported by Asset light model and fast growth Supply Chain Management business. We would like to rate “POSITIVE” to Mahindra Logistics IPO and Post IPO view is positive for short term investment.