An Edelweiss research report for Q4FY21 says road tonnage continued to improve, evident in e-way bill generation (up 6% QoQ) and improved core trucking rentals. “We estimate tonnage would increase by three–five percent for truckers. Asset-light plays Mahindra Logistics and TCI Express remain our preferred picks due to their ability to scale up/down as the environment demands,” the report said. Edelweiss is bullish on Blue Dart Express due to the pandemic-induced boom in e-commerce and its leaner cost structure. It has retained a ‘buy’ call on Mahindra Logistics, TCI Express and Blue Dart Express.
Sharekhan's research report on GAIL (India)
Q4FY2021 PAT of Rs. 1,908 crore (up 28.3% q-o-q) was 15.6% above our estimate, led by strong performance across commodity-linked businesses of petchem/LPG-LHC/gas marketing supported by higher oil price. Q1FY2022 gas transmission volume to get impacted by lockdown in April 2021-May 2021 and petchem utilisation due to maintenance plant shut down; however, high HDPE, LPG, and spot LNG prices would keep profitability strong. Earnings growth outlook (expect a 29% PAT CAGR over FY2021-FY2023E) has improved considerably, given high profitability for petchem and LPG-LHC segments post the sharp rally in oil price to <$70/bbl. Transmission volume to grow steadily at 6-8% volume p.a.
Outlook
Valuation of 7x its FY2023E EV/EBITDA seems attractive, given expectation of strong earnings revival and potential value unlocking from monetisation of gas pipeline assets. We maintain our Buy rating on GAIL with a revised PT of Rs. 196.
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