Monthly Chartbook: India's recovery gaining ground. Weekly Wrap: India's fiscal impulse drive yields higher. VRLL: Earnings momentum gathering pace

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VRL Logistics' (VRLL) Q2FY21 print beat our estimates on all fronts.

Registered Office:Rukmini Towers, 3rd& 4th Floor, # 3/1, Platform Road, Sheshadripuram, Bangalore - 560 020,...

Weekly Wrap: Global yields rise as recovery continues. VRLL: Insipid Q1 but steady recovery bodes well. MTLM: Q1 revenues slump; outlook improving

VRL Logistics (VRLL) reported a weak topline in Q1FY21, as the lockdowns and other headwinds put pressure on both goods and bus segments. Improvement seen in July on operational front. Management highlighted the following: (1) Targets nominal profit in FY21E, PAT positive in July (2) No major capex for FY21 (3) Price hikes taken to offset volume fall. (3) Focus on client addition (4) Cost control measures taken like pay cuts (5) Improvement in availability of workers and drivers (6) Asked for rent waiver for April month (7)...

Lockdown-induced disruptions catalysed a steep 70% YoY decline in VRL Logistics' (VRLL) Q1FY21 topline to Rs 1.6bn.

VRL Logistics reported the muted revenue growth for FY20 as the difficult macroeconomic conditions put pressure on both Goods Transport (~81% of revenue) and Bus Segment (~16% of revenue). Both the segments were hit badly by COVID-19. The asset ownership model operated by the company along with ~20,000 employee base and fluctuation in diesel cost attracts has affected monthly fixed costs which is expected to put huge pressure on margin and expect to incur the losses in FY21. Recovery is...

VRL Logistics' (VRLL) Q4FY20 print was weak.

We initiate coverage on VRL Logistics (VRLL) with BUY and a Mar'21 TP of Rs 330, set at 22x FY22E P/E.

Maintains 10% tonnage growth guidance for FY19 For Q2FY19, the revenue from operations grew 14.4%YoY to ` 5,169.9mn; de-grew 2.2% QoQ from ` 5,284.7mn. EBITDA declined 3%YoY to ` 541mn; declined 10.2% QoQ from ` 602mn. EBITDA Margin decreased by 188Bps YoY to 10.5%; a decrease of 94bps QoQ. Operating expenses increased 19.2% YoY to ` 3,651mn, a decrease of 2.1% QoQ. The increase in operating expenses was primarily due to increase in fuel cost with overall fuel cost to sales grew from 23% to 26% YoY and the fuel procurement cost...

VRL reported Q2FY18 numbers, marginally below our expectation with de-growth in both trucking as well as the bus segment. Trucking segment was impacted by weak volumes in July 2017 due to GST implementation, while the bus segment was weak due to seasonality. Sales was reported at Rs 4.52 bn (-8% QoQ and flat YoY) with YoY improvement in EBIDTA margin at 12.3% (+120 bps YoY) on the back of improving turnaround time for trucks with removal of interstate check post. Interest cost has further decreased with prepayment of debt in the quarter. Consequently the company has reported PAT of Rs 216 mn (+27% YoY)...

We recently met the management of VRL Logistics, one of the leading pan-India surface logistics & parcel delivery less than truck (LTL) service providers. We wanted to understand the company's business model and the opportunity available to VRL post implementation of the Goods & Service Tax (GST). VRL is mainly engaged in domestic transportation of goods across India. Its other business include bus operations, air chartering service and sale of power. Goods transportation (78% of total revenues in FY16) remains the key revenue driver for VRL. It is currently...

Key highlights: Revenue was up 2.3%yoy to Rs. 4.6bn, inline with our estimates. Goods transport (GT) (78% of revenue) reported revenue growth of 4.2%yoy while bus segment (20%ofsales)revenuedeclinedby3.7%yoytoRs912mn.EBITDAdeclinedby20%yoytoRs 670mn,lowerthanestimatesofRs750mn.EBITDAmarginsdeclinedby412bpsyoyto14.6% inQ1FY17.EBITDAmarginsingoodtransportdeclinedby280bpsyoyto12.9%whileinbus segment,marginsdeclinedby620bpsyoyto22.4%inQ1FY17.Margindeclinewasmainly duetoloweravailabilityofbiodieselandcostinflation.Employeecostincreasedby26%yoy toRs661mnduetoincrementin2QFY16.Interestcostdeclined36%yoytoRs67mnwith...

Key highlights: Revenue was up 4.6%yoy to Rs. 4.2bn, inline with our estimates. Goods transport(GT)(78%ofrevenue)reportedagrowthof6.9%whilebussegment(20%ofsales) revenue declined by 5%yoy. Higher driver's salary resulted in 153bps reduction in EBITDA...

Key highlights: Revenue remained flat yoy, almost 6% lower than estimates. Goods transport(GT)(78%ofrevenue)reportedmarginalgrowthof1.8%whilebussegment(20% of sales) revenue declined by 5% with fleet reduction. Higher lorry hire charges to cater...

During Q2FY16, the revenue of the company declined by 1.2% to Rs. 4272 Mn on YoY basis. Fall in the revenue was largely due to passenger segment where the management continued with its consolidation activities and made no replacement for the buses going off-road on permit expiry. The revenue growth in the goods transportation segment also remains flat on account of delay in the festive season and de-growth in the agriculture.

Key highlights: Sluggish monsoons and delay in festive season (Diwali in November this year), caused lower offtake in good transport (GT) business leading to flat revenues. Bus operationrevenuefell5%,asthenumberofVRL'sbusesreducedto368.Declineindiesel...

Revenue to grow at CAGR of 11%: The company's goods transportation division has strong pan India presence covering 28 states, 4 union territories and more than 662 cities with the help of more than 1000 branches and franchisees; and 48 strategically located transshipment hubs. Going forward, the company is planning to add 300 trucks in this division and is also planning to strengthen its infrastructure in its existing market in the southern and western regions of India; and expand into northern and eastern regions. On this backdrop, we expect the division to report average revenue growth of 14% in the next two years. In the passenger segment, the company is going slow and is consolidating its position; and focusing on premium routes, thus we expect flat 2% average growth in this division.