1. At a Glance
Once a poster child for the asset-light logistics revolution, Mahindra Logistics is now juggling between declining margins, loss-making quarters, and a ₹750 crore rights issue priced at a 30% discount. But wait—there’s more. It still manages 22M+ sq. ft. of warehouses and 15,000+ trucks per month.
2. Introduction with Hook
If India’s economy is a fast-moving train, logistics is the overworked engine driver with a sprained back and an HR complaint pending. Mahindra Logistics (MLL), once seen as the solution to India’s infrastructure mess, now looks like it took the wrong highway exit somewhere in FY23.
- Revenue in FY25: ₹6,105 crore
- Net Loss in FY25: ₹30 crore
- Rights Issue Price: ₹277 vs CMP ₹412
The question is—are we witnessing a turnaround story or an extended traffic jam?
3. Business Model (WTF Do They Even Do?)
Mahindra Logistics isn’t your local courier boy. Here’s what they really do:
- Contract Logistics (B2B) – Servicing industries like automotive, FMCG, pharma. Includes warehousing, packaging, reverse logistics.
- 3PL Operations – Entire supply chain outsourcing for companies.
- Last-Mile Delivery (eComm heavy) – Yes, the “Amazon-type” stuff.
- Enterprise Mobility – Staff transport solutions (yes, Uber for employees).
Core Play: Asset-light. Own nothing, control everything. Their warehouses and trucks? All leased or outsourced.
4. Financials Overview
Profit & Loss Summary (₹ Cr)
| Year | Revenue | OPM % | PAT | EPS |
|---|---|---|---|---|
| FY22 | 4,141 | 4.4% | ₹15 | ₹2.4 |
| FY23 | 5,128 | 5.0% | ₹25 | ₹3.6 |
| FY24 | 5,506 | 4.2% | -₹53 | -₹7.6 |
| FY25 | 6,105 | 4.9% | -₹30 | -₹5.0 |
They’ve grown revenue. But profits have disappeared faster than Flipkart discounts on Big Billion Day.
5. Valuation
Let’s ignore the past sins and play with some hopeful assumptions:
- Bull Case: ₹8,000 Cr Revenue by FY27 with 6% OPM and PAT margin of 3%
- PAT = ₹240 Cr → FV = ₹80–90 (P/E 20–25)
- Bear Case: Flat revenue, persistent losses
- FV = ₹150–170 (book value-based, P/B ~2.5x)
- Base Case: Gradual recovery in margins, PAT ₹100–120 Cr by FY27
- FV = ₹250–300 range
Current Price: ₹412
Fair Value Range: ₹150 – ₹300
6. What’s Cooking – News, Triggers, Drama
- Rights Issue: ₹750 Cr at ₹277/share. Dilution alert, but also balance sheet booster.
- Mobility Biz: Rumoured hive-off in progress. Could unlock value or just unlock headaches.
- Auto Sector Revival: Good for logistics demand.
- GST Boost: Pan-India compliance = more 3PL contracts.
- Concall Commentary: “FY26 will be better”—because FY25 can’t get worse.
7. Balance Sheet
| Year | Equity | Reserves | Borrowings | Fixed Assets | Total Assets |
|---|---|---|---|---|---|
| FY22 | ₹72 Cr | ₹475 Cr | ₹402 Cr | ₹501 Cr | ₹1,975 Cr |
| FY24 | ₹72 Cr | ₹420 Cr | ₹739 Cr | ₹836 Cr | ₹2,477 Cr |
| FY25 | ₹72 Cr | ₹366 Cr | ₹869 Cr | ₹930 Cr | ₹2,579 Cr |
Key Takeaways:
- Leverage rising, Net Worth falling.
- Fixed assets ↑ (maybe automation push?), but funded by debt.
- Not alarming yet, but not ideal either.
8. Cash Flow – Sab Number Game Hai
| Year | CFO | CFI | CFF | Net Cash Flow |
|---|---|---|---|---|
| FY22 | ₹191 Cr | -₹140 Cr | -₹117 Cr | -₹66 Cr |
| FY24 | ₹227 Cr | -₹53 Cr | -₹276 Cr | -₹102 Cr |
| FY25 | ₹343 Cr | -₹155 Cr | -₹148 Cr | ₹41 Cr |
Observation:
Operating cash flow solid, but free cash flow is squeezed due to investment + debt repayment. Rights issue will help reduce pressure… maybe.
9. Ratios – Sexy or Stressy?
| Metric | FY23 | FY24 | FY25 |
|---|---|---|---|
| ROCE % | 7% | 3% | 6% |
| ROE % | 3.65% | -7.6% | -4.97% |
| Interest Coverage | 0.6x | 0.3x | 0.2x |
| Cash Conv. Cycle | 46 days | 47 days | 37 days |
Verdict: Stressy. Needs either a margin revival or equity infusion (oh wait, that’s happening).
10. P&L Breakdown – Show Me the Money
| Quarter | Sales (₹ Cr) | OPM % | Net Profit (₹ Cr) |
|---|---|---|---|
| Mar ’24 | 1,450.76 | 3.9% | -₹11.91 |
| Jun ’24 | 1,420.02 | 4.7% | -₹7.84 |
| Sep ’24 | 1,521.10 | 4.3% | -₹9.61 |
| Dec ’24 | 1,594.20 | 4.6% | -₹7.26 |
| Mar ’25 | 1,569.51 | 4.9% | -₹5.29 |
They’re losing less money each quarter. Progress?
11. Peer Comparison
| Company | ROCE % | PAT (₹ Cr) | OPM % | CMP/BV | ROE % |
|---|---|---|---|---|---|
| Container Corp | 13.69% | ₹1313 | 21.7% | 3.77 | 10.85% |
| Blue Dart | 17.16% | ₹252 | 15.2% | 10.44 | 17.25% |
| VRL | 15.73% | ₹177 | 18.1% | 5.13 | 17.44% |
| Mahindra Logistics | 6% | -₹30 | 4.9% | 6.79 | -6.7% |
Ouch. MLL is the only one with negative ROE. Its cost structure needs serious work.
12. Miscellaneous – Shareholding, Promoters
- Promoters: ~58%
- FII Holding: Down from 20% (Jun ’22) to 5% (Mar ’25)
- DII Holding: Flat
- Public Holding: Up to 23%—retail buying the dip?
Rights issue could change this dynamic.
13. EduInvesting Verdict™
Mahindra Logistics is like a smart MBA with bad spending habits. The model is scalable, asset-light, and diversified—but execution? Meh. With consistent losses and increasing debt, it’s a turnaround story if they can course-correct on margins and interest cost.
The ₹277 rights issue might be the reboot. But investors would be wise to watch earnings, not announcements.
Metadata
– Written by EduInvesting | 20 July 2025
– Tags: Mahindra Logistics, Rights Issue, Logistics Sector, Turnaround Stocks, Smallcap Transport, Asset-Light Logistics
