Ideas for Profit | Mahindra Logistics vs Future Supply Chain Solutions: Which stock should investors buy?

Published on Nov 09, 2018
By Money Control

In the first half of this fiscal year, FSCS has added Haldirams, Crompton Greaves and Voltbek Home Appliances (JV between Voltas and Turkey-based Arçelik) and JK Helene Curtis (Raymond Group Company) to its list of clientele.

Mahindra Logistics and Future Supply Chain Solutions, two of the largest third party logistics (3PL) players in the country, reported strong quarterly results for the second quarter of FY19. While the financial performance of FSCS was aided by addition of non-anchor clients, MLL’s strong quarterly earnings was driven by an improvement in operating margins.

These companies merit attention of long-term investors as the consistency in their quarterly performance indicates at a secular growth trend in the 3PL sector.

Future Supply Chain Solutions (FSCS)

 Revenues from operations increased by 35 percent to Rs 276 crore in Q2 FY19, compared to last year’s revenue of Rs 205 crore. On sequential basis revenues rose 21 percent. Strong performance from the Contract Logistics segment, which contributes more than 60 percent of total revenues, drove the overall topline growth. Revenues from this segment surged to Rs 221 Crores in Q2 FY19 from Rs 151 Crores in Q2 FY18, which translates to a year-on-year (YoY) growth of 46 percent. Express logistics segment revenues grew by 11 percent whereas the temperature controlled logistics reported a flat topline.

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