Prabhudas Lilladher: Allcargo a long-term bet

Prabhudas Lilladher said Allcargo Global Logistics is a steady long-term bet.

In a report released on August 23, the brokerage said: "Compared to revenue and profit of Rs 2.8bn and Rs 495m in FY06, we expect the company to report revenue and profit of Rs 16.6bn and about Rs 914m in FY07, and Rs 17.9bn and Rs 1,393m in FY08.

"Based on our first-cut consolidated EPS estimates of Rs 45.1 and Rs 68.8, the stock quotes at a PER of 14.4x and 9.4x FY08.

"We feel that the logistics industry and AGL will continue to grow consistently yoy by 20-25%, given the growth in the country's EXIM trade. This, coupled with the expected turnaround in Eculine's profitability, would lead to higher-than-proportional growth in profit. Both the industry and the company offer good value to investors for the medium to long term. We will be coming out with a detailed report shortly."

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