What are Gopal Kavalireddi's views on Allcargo Logistics stock for investment?

Written on Nov 27, 2017
Logistics as a sector has been under serious transition over the last 1–2 years and GST was supposed to be a major reform, bringing the organized players like All Cargo, Gati, VRL Logistics, Chartered Logistics etc to improve their margins. However, not much has happened even after 3 months of GST introduction.

A simple look at the logistics stocks on Stock Screener for Indian Stocks: Screener.inwill highlight the issues. All Cargo has the lowest operation margin in the group with just 7.83%. On a sales turnover of Rs. 1800 cr, the net profit is only 65 cr. which is very less.
Over the last 12 quarters, the sales are stagnant with the operating profit margin dipping further.
Obviously, this financial performance is reflected in the stock performance, which has not even given savings bank returns of 4% in 1 year.

Though Sical Logistics and Gateway Distriparks are showing better operating profit margins, the pledged promoter shareholding is a worry. Blue Dart, VRL Logistics and TCI Express have high P/BV which is not a preferred option.
Hence, logistics sector is in a precarious situation, with none of the stocks filtering out to be possible selections for investment. However, with the private investment push that is happening currently, infrastructure is getting a good boost. Once we see more projects commencing, we can expect higher movement of goods and materials, which can be reflected in better sales performance. Net Profit would need to be checked if the pricing pressure continues in the same manner in the coming quarters also or if it will ease out soon.

Financial data credits: Stock Screener for Indian Stocks: Screener.in

Stock graph credits: Fyers - Your Next-Generation Online Stockbroker

Comments

  1. wealthbuildupDecember 6, 2018 at 1:51 AM

    I was looking for some trading tips then i have visited your blog and found very useful tips. Please suggest some stock tips in future.
    Equity tips
    Commodity tips
    SEBI Registered Investment advisor`

    ReplyDelete
  2. quantinnazacariasFebruary 28, 2022 at 2:41 AM

    Best Slots for Android and iOS - Wooricasinos.info
    Top 5 Best 솔레어 Casinos 마이크로 게이밍 for Online Slots ✓ Casinos with 비트코인갤러리 Instant 프라하 사이트 Play ✓ Best Bonus Offers ✓ Best Bonus Offers ➤ Play for Real 마카오바카라 Money ✓ Top

    ReplyDelete

Post a Comment

Popular posts from this blog

What is Gopal Kavalireddi’s analysis on HB stockholdings Ltd. stock for investment? Can it be a multibagger?

Image
Written on Nov 18, 2017 Christopher Walken , the Academy award winner & an excellent American actor, once said  “improvising is wonderful. But, the thing is that you cannot improvise unless you know exactly what you're doing. The reason why I quoted Mr. Walken was that, with so many queries pending from readers, I wanted to improvise & still cover an entire analysis in short. Normally, for any stock analysis, we examine certain financial & qualitative parameters, which I included in the query builder. The query & response can be viewed at  Stock Screener for Indian Stocks: Screener.in With such a tight parameter setting, the query returned only three stocks, one of which is HB Stockholdings Ltd. Upon examining the Q2 FY18 financials, the stock has shown impressive growth. The full financials are at:  http://www.bseindia.com/xml-data... However, there is not much information available on the company website:  HB STOCKHOLDINGS LTD  and there is nothi
Read more

What is Gopal Kavalireddi's opinion on Rain Industries, Graphite India, Phillips carbon stocks at current situation?

Image
Written on Nov 22 For a guy like me, who relies mostly on fundamental analysis, which is normally used to forecast price targets for the longer term, I get asked for a lot of opinions. By asking for opinion, the reader basically wants to know about the current downtrend or the day-to-day volatility in the stocks - as they have bought at a higher price and are confused with the current state of the stock movement. This is the result of chasing momentum stocks. Once momentum is built, either on the upside or downside, it is highly ‘inappropriate’ to run after them, till they atleast start slowing down, because they are surely going to burn a hole in your pocket. But anyway, since there are so many readers asking for ‘opinion’ on these stocks, I am giving the same. This is the current state of the stocks mentioned, as I write the answer. All the above stocks are concentrated product portfolio stocks, operating in the carbon related product space, which have seen a huge d
Read more

How should I invest my Rs 70000 salary if I need to save up for marriage in two years and need a good amount of liquidity?

Image
Written on Apr 13 2016 Normally, as a personal policy, I don't answer anonymous questions as part of A2A. However, I am making an exception and providing you with some possible options. The first thing is to check if you have availed all the tax exemptions in India, check this:  Gopal Kavalireddi's answer to How do I save my income tax?  The reason I am asking you to check the taxes is to see if there is any possibility of saving more money. There are many ways to invest but investing systematically will help you in the long run. But, before you start investing off, the first thing to do is have 6 months worth of your expenses in your bank account. This is because incase you lose your job (assuming you are a salaried employee) you will not have income, but expenses only till you find the next job. This money is to tide you over that period, which you can leave in an FD earning 7.25% pre tax. U need to take health insurance (take separately even if your employer provi
Read more