Multibagger Alert: Rs 121 to Rs 292, This smallcap logistics stock gave a return of 140% in 2021

An amount of Rs 1 lakh invested in Gateway Distriparks in January 2021 would have become Rs 2.41 lakh in December 2021.

With strong fundamentals, the stock of multibagger Gateway Distriparks rallied from Rs 121 from January 2021 to Rs 292 today, surging 2.41 times in a year. Rs 1 lakh invested in January 2021 would have become Rs 2.41 lakh today.

The company has posted exceptional revenue and profit growth in the last 3 to 4 quarters, the anticipation of strong growth in revenue, profit and steady margins has made the stock rally in 2021. It hit a 52-week high of Rs 325 in June 2021. Currently, it is trading at Rs 291.50.

Gateway Distriparks is the only logistics facilitator in India with three verticals that are synergetic and capable of being interlinked namely, container freight stations (CFS), inland container depots (ICD) with rail movement of containers to major maritime ports along with cold chain storage & logistics.

Revenue driver: The rail segment comprises approximately 70% of consolidated revenue, with the rest being contributed by container freight stations (CFS).

Capex Plans: GDL plans to invest in rail-linked satellite terminals in the north. Satellite terminals will enable aggregation of cargo through its flagship terminal - Garhi Harsaru in Gurugram. The company plans to set up two terminals in the next few years. This will entail a Capex of Rs 120 crore over the next couple of years.

Financials

Recent Quarter: In Q2FY22, the company’s revenue grew by 27.89% YoY to Rs 335.74 crore from Rs 262.52 crore in Q2FY21. PBIDT (ex. OI) was reported at Rs 91 crore, up by 39.48% as compared to the year-ago period. The corresponding margin was reported at 27.10%, expanding by 225 basis points YoY. PAT was reported at Rs 46.7 crore, up by 996.24% from Rs 4.26 crore in the same quarter for the previous fiscal year. PAT margin stood at 13.90% in Q2FY22, expanding by 1,228 bps YoY.

Past 3-years: The sales have almost tripled in the last three years, increasing from Rs 395.5 crore in FY18 to Rs 1,179 crore in FY21 at a CAGR of 43.93% for the same period. It was supported with a strong 3-year EBIT CAGR of 54.80%, which witnessed a steady increase from Rs 97 crore in FY18 to Rs 327 crore in FY21. This shows the consistent growth of the company.

Do you think Gateway Distriparks can sustain the rally with their strong earnings growth in future?