Shree Vasu Logistics Ltd. engages in the provision of logistic services. It offers warehousing, packing, and logistics. The company was founded by Shree Bhushan Garg in 1987 and is headquartered in Raipur, India.

India

Shree Vasu Logistics Limited

Industrials

The company does not pay dividends at all, or it pays them sporadically. There have only been a few years with dividend payments in the past ten years. 

SVLL.NS reported revenue of INR 1 303mn in the last 12 months, up 11% from FY23. At the same time, the dynamics of cash flow, as measured by free cash flow (FCF), were drastically different. EPS fell 41% from FY23 to INR 1.64.

The stock's performance has been mixed in the past six months, with growth following a decline. There is no clear price trend compared to its global peers from the same sector and industry (as shown above). The stock has outperformed this peer group by 124ppts over past six months and grown 42ppts faster in the past month. At the same time, the stock's performance relative to its the peers from the same country and sector is different. The stock outperformed these peers by 133ppts over the past six months and grew 36ppts faster in the past month. With respect to the stock's valuation against its peers, its overall price performance is positive. Usually, this means that a fairly valued or slightly undervalued stock has become more 'expensive', indicating that the market, in general, may have gained short-term confidence in the stock.

The company has reported average EBITDA margins compared to its global peers in recent years. EBITDA margin amounted to 19.9% in the last 12 months, a decline from 24.5% in FY23. 

Historically, SVLL.NS has reported weak net margins compared to its global peers. Specifically, in the last 12 months, this metric equalled 1.4%, down from 2.7% in FY23. 

In the last 12 months, the return on capital employed (RoCE) declined to 1.7%, below the peers. 

Shree Vasu Logistics Limited reported a return on equity (RoE) of 5.8% in the last 12 months, down from 10.2% in FY23. 

Another important profitability metric, return on assets (RoA), amounted to 1.2% in the last 12 months, a decrease from 2.9% in FY23. 

The ratio of return on invested capital (RoIC) to the weighted average cost of capital (WACC) has been 0.8 in the past several years. This ratio implies a poor shareholder value creation. 

The institutional, legal, and compliance risks associated with the company's country are close to minimal. In combination with rigorous business standards, shareholder rights are well protected.

SVLL.NS has very poor trading liquidity. It will take considerable time for the average private investor to sell a common position under normal market conditions. Liquidity is very unstable and becomes extremely unfavourable on the days with the lowest activity. The trading volume mostly stays the same even under highly turbulent market conditions. Another factor to consider is the substantial number of days with zero trading volumes, i.e., without any ability to sell a position. The stock has a tiny market capitalisation, which usually makes its trading liquidity erratic and unpredictable. 

No other major risks have been identified.

The risk of default is moderate. We note robust profitability and solid cash flow generation, among the positive credit factors. Among the negative credit factors, we point to weak positions in its industry, negligible return on capital, poor working capital management, and an unfavourable capital structure.

In highly turbulent market conditions, SVLL.NS is not overly volatile. In other words, the stock will fall less than the index in times of extreme market volatility or shocking company news. Standalone, the worst-day losses (less than 1% of the time) will likely be low. 

In normal market circumstances, SVLL.NS is moderately volatile. Put differently, without outstanding market volatility or shocking company news, the stock's price will move slightly wider than the index. The stock's losses on its worst days (less than 1-5% of the time) will range from low to minimal. We would also like to highlight the minimal intraday volatility of the instrument. 

From both historical and forecast perspectives, the stock is slightly overpriced compared to similar stocks. In particular, the stock is overpriced on P/E, 'expensive' on EV/EBITDA, trading at neutral levels on P/FCF. 

Shree Vasu Logistics Limited

₹ 576.95

3

Shree Vasu Logistics Limited

₹ 576.95

3

Risk factor

Profitability factor

Risk / Profitability

Risk factor

Profitability factor

₹ 576.95

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