Motilal Oswal projects 29% upside for this logistics stock on lower GST aiding volumes

Shares of logistics services provider VRL Logistics Ltd. will be in focus on Friday, September 12, after brokerage firm Motilal Oswal reiterated its 'Buy' recommendation on the stock.

Motilal Oswal has a price target of ₹350 on VRL Logistics, which implies a potential upside of 29% from Thursday's closing levels.

The brokerage wrote in its note that the recent GST cuts across products, aimed at boosting consumption, should support volumes for logistics players like VRL. However, it expects VRL to prioritise maintaining high margins despite a slowdown in volume growth.

VRL is among the largest fleet owners of commercial vehicles in India, operating 5,949 trucks with a total capacity of 80,722 tons as of June 2025.

Going forward, the company plans to expand its fleet in line with volume growth. However, if volume growth falls short, it will take a conservative stance on capex.

According to Motilal Oswal, the company is well-positioned for long-term growth, supported by its strategic focus on profitable contracts, operational efficiency, and strong service reliability.

The company's investment in technology, disciplined cost management, and robust hub-to-hub network create a strong foundation to scale operations as demand recovers.

While near-term challenges remain, the brokerage said GST cuts, cautious capacity expansion, and a stable pricing strategy should help VRL benefit from structural growth in India's organised surface logistics sector.

It expects the company to report flat volumes but deliver revenue, EBITDA, and PAT CAGR of 6%, 10%, and 19%, respectively, over FY25-27.

All nine analysts tracking shares of VRL Logistics have 'Buy' ratings on the counter.

Shares of VRL Logistics Ltd. ended 1.08% higher on Thursday at ₹271.95. The stock is down 52% in the last one month, and 47% in 2025 so far.

Note To Readers

Disclaimer: The views and investment tips expressed by investment experts on CNBCTV18.com are their own and not that of the website or its management. CNBCTV18.com advises users to check with certified experts before taking any investment decisions.