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Multi Baggers

Hem Securities

5.30 AM Jan 1st 1970

Allcargo

BSE ID : 532749     NSE ID : ALLCARGO

RECOMMENDED PRICE 299.60

PEAK FROM RECO 494.85 65.17%

CURRENT PRICE 71.62 Resource id #18

Allcargo Logistics Limited is a leading Indian multinational company providing integrated logistics solutions. We initiate a 'BUY' on the stock with a target price of Rs. 398 with the medium to long term investment horizon.

Allcargo Logistics Limited

Allcargo Logistics Limited, part of the Avvashya Group, is a leading Indian multinational company providing integrated logistics solutions. The Company offers specialized logistics services across Multimodal Transport Operations (MTO), Container Freight Station Operations (CFS), Inland Container Depot (ICD) and Project & Engineering Solutions (P&E).

Benchmarked quality standards, standardized processes and operational excellence across all the services and facilities, have enabled the company to emerge as a leading player in all these segments. The company owns leading multinational companies in the logistics space globally such as ECU-LINE, which is world's largest LCL service provider operating from Belgium. It also owns USA-Miami based NVOCC leader Econocaribe Consolidators and Rotterdam based FCL Marine Agencies specializing in FCL services.

The company has registered strong results for the quarter ending June 2015. The revenues from operations grew by about 12% to Rs.1477.91 crs vs. Rs.1320.91 crs in the year ago quarter while it grew approx. 4.43% q-o-q. Operating profit climbed by 33% at Rs 100.63 crores as against Rs 75.70 crores in the previous year quarter. The adjusted net profit stood at Rs 75.10 crores for the quarter as against Rs 48.98 crores; registering robust growth of 53%.

Valuation

Allcargo has strong presence across all lines of businesses i.e. MTO, CFS and P&E businesses. It has emerged as the second largest player in the LCL consolidation business globally and is the only Indian player who has a strong presence across multiple logistics businesses of CFS, contract logistics, project logistics, equipment leasing and costal shipping in India. The company is focused on top and bottom line growth, ROCE, asset utilization and generation of cash flows across all the businesses. The company is well placed to cash on the emerging opportunities in the logistic space in India. The company is trading at an attractive valuation at 12x and 10.16x FY16 EPS of Rs 24.92 and FY17 EPS of Rs 29.49. We initiate a 'BUY' on the stock with a target price of Rs. 398 (appreciation of about 33%) with the medium to long term investment horizon.

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Disclosure of Interest Statement - Company Name

1. Analyst Ownership of the Stock - No

2. Hem & its Group Company Ownership of the Stock - Yes

3. Hem & its Group Companies' Director Ownership of the Stock - Yes

4. Broking relationship with company covered - No

Disclaimer & Disclosure: This document is prepared for our clients only, on the basis of publicly available information and other sources believed to be reliable. Whilst we are not soliciting any action based on this information, all care has been taken to ensure that the facts are accurate, fair and reasonable. This information is not intended as an offer or solicitation for the purchase or sell of any financial instrument and at any point should not be considered as an investment advise. Reader is requested to rely on his own decision and may take independent professional advise before investing. Hem Securities Limited, Hem Finlease Private Limited, Hem Multi Commodities Pvt. Limited, Directors and any of its employees shall not be responsible for the content. The person accessing this information specifically agrees to exempt Hem Securities Limited, Hem Finlease Private Limited, Hem Multi Commodities Pvt. Limited or any of its affiliates or employees from, any and all responsibility/liability arising from such misuse and further agrees to hold Hem Securities Limited, Hem Finlease Private Limited, Hem Multi Commodities Pvt. Limited or any of its affiliates or employees free and harmless from all losses, costs, damages, expenses that may be suffered by the person accessing this information due to any errors and delays. The companies and its affiliates, officers, directors, and employees, including persons involved in the preparation or issuance of this material may from time to time, have long or short positions in, and buy or sell the securities there of, company (ies) mentioned here in and the same have acted upon or used the information prior to, or immediately following the publication. Analyst Certification The views expressed in this research report accurately reflect the personal views of the analyst(s) about the subject securities or issues, and no part of the compensation of the research analyst(s) was, is, or will be directly or indirectly related to the specific recommendations and views expressed by research analyst(s) in this report.

AllcargoLogistics_PYT.pdf

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