01 — At a Glance
The Comeback Kid. Seriously. This Time.
- 52-Week High / Low₹435 / ₹218
- Q3 FY26 Revenue₹1,898 Cr
- Q3 FY26 PAT (Reported)₹6.01 Cr
- Q3 FY26 PAT (Operational)₹9.2 Cr
- Annualised EPS (Q3×4)₹2.44
- Book Value₹115
- Price to Book3.31x
- Debt (Consolidated)₹64 Cr
- Rights Issue (Aug 2025)₹749 Cr
- Interest Coverage1.12x
Auditor’s Note: MLL just posted a profit after 11 straight loss-making quarters. Yes, PAT is ₹6 Cr (operational ₹9.2 Cr after Labour Code adjustments). The CEO explicitly called this an “inflection point” and backed it with operational metrics: EBITDA ₹102.8 Cr (+40% YoY), gross margins at 10%, and the B2B Express subsidiary (MESPL) finally trending positive. A ₹749 Cr rights issue in August deleveraged the balance sheet from ₹604 Cr debt to ₹64 Cr. The volatility in the share price (+58% YoY) reflects exactly this—market FINALLY believes the turnaround is real.
02 — Introduction
The Stock That Learned Its ABCs in Hell and Came Out Smiling
Mahindra Logistics is the textbook case of a company that made every mistake in the logistics playbook simultaneously. Acquired Rivigo’s B2B Express business during peak overvaluation. Operated three loss-making subsidiaries in parallel. Allowed Mahindra Group dependency to creep from 70% to below 60% revenues, which sounds like diversification until you realize the mothership still dominates profitability.
Then, in February 2026, new MD Hemant Sikka walked in—literally took over in May 2025—and essentially said, “Gentlemen, this ends now.” By Q3 (Dec 2025), the company was profitable. And not a hair-thin, accounting-adjusted kind of profitable. EBITDA up 40% YoY. Contract Logistics (3PL) revenue +20% YoY to ₹1,502 Cr. Freight Forwarding growth of 33%. B2B Express volumes up 19% with turnaround velocity from 0.2% gross margin to 2.4% YoY. Last-mile Delivery? Still broken. But management is finally honest about it—they’re exiting unprofitable lanes instead of praying.
This is what a real turnaround looks like in India. Not a stock chart moon shot. Not vapid management commentary. Just: brutal cost discipline, customer repricing halfway through a cycle, a rights issue that deleveraged the balance sheet by ₹540 Cr, and a CEO willing to walk away from revenue that loses money. The 58% 1-year stock return reflects a market that doubted. Now believing. Still cautious. Fair assessment.
Concall Insight (Feb 2026): CEO directly stated the business is “halfway through repricing” and “willing to step away from non-profitable relationships.” Not a single analyst bought the old narrative anymore. Everyone wanted one thing: sustained execution. Management’s response? “White space elimination by September 2026. 95% reduction. We are slightly better on our glide path.” No guidance given. Translation: they’ve learned.
03 — Business Model: Trucks, Trains, Planes & Loss-Making Dreams
If Logistics Were a Restaurant, MLL Would Be Cooking in 4 Kitchens at Once
Mahindra Logistics owns five business lines, each with its own dysfunction story:
3PL (Contract Logistics) — 79% of revenue
The crown jewel. Manages 20.5+ million sq. ft. of warehouse space across 400 locations. Fleet of 15,000+ vehicles. Serves auto OEMs (Mahindra, Cummins, Bosch, Mercedes), FMCG (ITC, P&G), e-commerce (Flipkart, Amazon). Q3 revenue ₹1,502 Cr (+20% YoY). The problem: 62% of volumes still come from auto, and 58% of 3PL revenue comes from Mahindra Group. That’s the trap. The opportunity: new customer wins in e-commerce and non-Mahindra auto.
MESPL (B2B Express) — The Phoenix
Rivigo acquisition in Nov 2022. Massive loss-making hellscape for 13 quarters. Q3 FY26: Revenue ₹113.6 Cr (+27.5% YoY). Gross margin finally positive at 2.4% (from 0.2% last year). Still operationally losing ₹14.5 Cr/quarter. But CEO says “EBITDA breakeven is imminent.” Volumes up 19%, yields stable sequentially. The bet: Mahindra Group uses MLL for backward lane consolidation, which improves unit economics. If true, this division becomes a 5-7% EBITDA contributor by FY27.
Freight Forwarding — 5% of revenue, 33% growth
Ocean freight, air cargo, project logistics. Q3 revenue ₹94.8 Cr (+33% YoY). Profitable segment that’s benefiting from global trade normalization. Management explicitly said “organic growth, no one-offs.” Operating leverage is kicking in. This becomes a high-margin satellite business as volumes scale.
Last-Mile Delivery & Mobility — 11% combined, both broken
Last-mile (6,000+ vehicles, 350,000 orders/day): Revenue ₹82 Cr, down from ₹103 Cr YoY due to management’s deliberate exit from loss-making lanes. Margin collapsed to ₹2.7 Cr from ₹7.3 Cr. CEO called it a “unit economics problem” and described the category as “zero-entry business” where pricing is perpetually pressured. Still, management expects profitability from Q4FY26 onwards if they hold pricing. Mobility (5,000+ vehicles for corporate transport): ₹110.7 Cr (+42% YoY), profitable, but asset-heavy and utilization-dependent.
💬 Quick poll: Do you think last-mile delivery will ever be profitable in India, or is it just VC money death-spiralling forever?
04 — Financials Overview
Q3 FY26: The Numbers That Broke The Loss Streak
Result type: Quarterly Results | Q3 FY26 EPS (reported): ₹0.33 | Annualised EPS (Q3×4): ₹1.32 | Q3 FY25 EPS: ₹-0.91 (loss)
| Metric (₹ Cr) |
Q3 FY26
Dec 2025 |
Q3 FY25
Dec 2024 |
Q2 FY26
Sep 2025 |
YoY % |
QoQ % |
| Revenue | 1,898 | 1,594 | 1,685 | +19.1% | +12.6% |
| Operating Profit (EBITDA proxy) | 102.8 | 74 | 85.04 | +40% | +20.9% |
| OPM % | 5.4% | 4.6% | 5.05% | +80 bps | +35 bps |
| PAT (Reported) | 6.01 | -7.26 | -8.36 | PROFIT | PROFIT |
| PAT (Operational) | 9.2 | -7.26 | -8.36 | Turnaround | Turnaround |
| EPS (₹) – Reported | 0.33 | -0.91 | -1.04 | Loss→Profit | +132% |
The Elephant in the Room: Q3 PAT of ₹6.01 Cr includes ₹7.36 Cr exceptional item (Labour Code one-time impact). Operational PAT ₹9.2 Cr is the real number. This distinction matters because if you reverse-annualize reported numbers, you get P/E ∞ (technically undefined for a near-zero earnings company). But operational annualized EPS (₹0.33 × 4 = ₹1.32) gives a P/E of ₹382 ÷ ₹1.32 = 289x—still eye-watering, but at least mathematically real. The market is pricing in growth, not current earnings. Fair or not, that’s the bet.
Concall Takeaway: Gross margin improved to 10% from 9.2% YoY. Management attributed this to “3PL profitability improvement” and “MESPL turnaround with ₹7.2 Cr YoY gross margin gain.” Interest costs fell “materially” post-rights issue. The balance sheet is now carrying only ₹64 Cr consolidated debt (down from ₹604 Cr pre-rights issue). Interest savings of ₹40-45 Cr annually are expected. This is real deleveraging, not financial engineering.
05 — Valuation: Fair Value is a Mirage Right Now
Can You Value a Company That’s Still Profitable-Adjacent?
Method 1: Forward P/E Based
FY25 full-year EPS was ₹-2.48 (loss). Q3 annualized EPS (₹0.33 × 4) = ₹1.32. For FY26 (full year estimate), assuming Q4 contributes similar earnings to Q3, we’d get ~₹3–4 Cr annual PAT = ₹0.30–0.40 EPS. Logistics industry P/E median is ~20–27x. MLL’s justified multiple given turnaround risk: 12x–18x. Fair range: ₹360–480.
Range: ₹360 – ₹480
Method 2: EV/EBITDA Based
Q3 annualized EBITDA (₹102.8 × 4) = ₹411 Cr. Enterprise Value = ₹3,786 Cr (mcap) + ₹64 Cr (net debt) = ₹3,850 Cr. Current EV/EBITDA = 9.4x. Logistics peers trade 8x–12x. Post-turnaround fair range: 10x–12x EBITDA.
Annualized EBITDA (Q3×4): ₹411 Cr → EV at 10x–12x:
Range: ₹372 – ₹448
Method 3: DCF (Speculative)
Operating CF FY25: ₹343 Cr. Assuming 15% annual growth over 5 years (conservative for logistics sector) and 3% terminal growth, WACC 10.5%:
→ PV of 5-year FCFs at 10.5%: ~₹1,950 Cr
→ Terminal Value (3% growth / 7.5% cap rate): ~₹2,200 Cr
→ Total EV: ~₹4,150 Cr (low risk premium built in)
Range: ₹390 – ₹465
Fair Min: ₹360
CMP: ₹382
Fair Max: ₹480
CMP ₹382
⚠️ EduInvesting Fair Value Range: ₹360 – ₹480. CMP ₹382 sits at the lower end of the fair range. The stock is not overvalued, but it’s pricing in sustainable 15%+ growth and sustained margin expansion. Any execution miss—say, if white space reduction stalls or MESPL’s momentum reverses—could see rapid de-rating. This fair value range is for educational purposes only and is not investment advice. Consult a SEBI-registered advisor before making decisions.
06 — What’s Cooking: Turnaround, Repricing & GST Hell
The Good, The Bad, and The Tax Notices
