Mahindra Logistics Q4 Results Review - Inline; Improved Express Performance Enhances Ebitda: Motilal Oswal

Motilal Oswal Report

Mahindra Logistics Ltd.’s Q4 FY24 revenue grew by ~14% YoY to Rs 14.5 billion (in line). Ebitda margin came in at 3.9% (in line), down 100 basis points YoY and up 20 bp QoQ. Ebitda decreased 11% YoY to Rs 566 million (in line).

Mahindra Logistics posted a net loss of Rs 128 million versus Rs 8 million in Q4 FY23 (our estimate of Rs 6 million loss).

Ebitda was impacted by one-time charges relating to IT integration and provisions. Adjusted profit after tax was hit by higher tax outgo. Losses in the Express business narrowed as capacity utilization improved in Q4. 

The Q4 performance was largely in line with our estimates. Going forward, Express business losses are expected to decline as volumes improve, which should result in improvement in overall Ebitda for Mahindra Logistics.

Strong order intake in the 3PL business should also support growth in the near to medium term.

We marginally increase our FY26 Ebitda/profit after tax estimates by 2%/6% on an improved earnings outlook. We estimate a CAGR of 23%/37% in revenue/Ebitda over FY24-26.

We reiterate our Neutral rating with a revised TP of INR420 (premised on 23x FY26E EPS).

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