Valuation Metrics Signal Enhanced Price Attractiveness
As of 16 Feb 2026, VRL Logistics trades at a price of ₹290.70, down 3.36% from the previous close of ₹300.80. Despite the recent dip, the stock’s valuation metrics have improved markedly. The price-to-earnings (P/E) ratio stands at 21.28, a level that the market now considers very attractive compared to its historical range and peer group. This is a notable improvement from previous assessments where the valuation was merely attractive.
The price-to-book value (P/BV) ratio is currently 4.64, reflecting a reasonable premium for a company with strong return metrics. When compared to peers such as Delhivery, which trades at a P/E of 174.72 and is classified as risky, or Blue Dart Express with a P/E of 47.24 labelled expensive, VRL Logistics’ valuation appears conservative and justified by its fundamentals.
Robust Profitability Supports Valuation Upgrade
VRL Logistics’ return on capital employed (ROCE) is 18.58%, while return on equity (ROE) is an impressive 21.81%. These profitability ratios underpin the company’s ability to generate healthy returns on invested capital, justifying the current valuation multiples. The EV to EBITDA ratio of 9.30 further supports the stock’s relative value, especially when contrasted with peers like Aegis Logistics (EV/EBITDA 19.64) and Blackbuck (EV/EBITDA 66.13), which are trading at significantly higher multiples.
Moreover, the company’s PEG ratio of 0.26 indicates that earnings growth is not fully priced in, suggesting potential upside if growth momentum sustains. Dividend yield at 3.44% adds an income component attractive to yield-seeking investors in the transport services sector.
Comparative Sector Analysis Highlights VRL’s Strength
Within the transport services sector, VRL Logistics stands out for its valuation discipline and operational efficiency. While some peers are trading at stretched valuations or are loss-making, VRL’s metrics reflect a balanced risk-reward profile. For instance, Transport Corporation of India and TVS Supply Chain Solutions are rated attractive but have higher P/E ratios of 18.03 and 35.95 respectively, with varying growth prospects.
Balmer Lawrie, another peer with a very attractive valuation, trades at a P/E of 11.43 but differs in scale and business mix. VRL’s market cap grade of 3 indicates a mid-sized company with room for growth and market recognition.
Stock Performance Outpaces Sensex Despite Recent Volatility
VRL Logistics has delivered strong returns over multiple time horizons, outperforming the benchmark Sensex in most periods. Year-to-date, the stock has gained 8.45% compared to a Sensex decline of 3.04%. Over one year, VRL Logistics returned 20.52%, more than double the Sensex’s 8.52% gain. Even over five years, the stock’s cumulative return of 154.39% far exceeds the Sensex’s 60.30%.
However, the 10-year return of 76.48% trails the Sensex’s 259.46%, reflecting the company’s more recent growth acceleration rather than long-term market dominance. The 52-week high of ₹579.20 and low of ₹216.45 illustrate significant price volatility, but the current price near ₹290.70 suggests a valuation reset that may appeal to value-oriented investors.
Mojo Score Upgrade Reflects Improved Investment Appeal
MarketsMOJO has upgraded VRL Logistics’ Mojo Grade from Hold to Buy as of 3 Feb 2026, reflecting the improved valuation and fundamental outlook. The Mojo Score of 74.0 indicates a strong buy recommendation, supported by the company’s solid financial health, attractive valuation, and sector positioning.
This upgrade signals increased confidence in VRL Logistics’ ability to sustain growth and generate shareholder value, especially given the transport services sector’s evolving dynamics and competitive pressures.
Valuation Context: Historical and Peer Comparisons
Historically, VRL Logistics’ P/E ratio has fluctuated between the mid-teens and low 30s, with the current 21.28 representing a midpoint that is attractive given the company’s growth and profitability profile. The P/BV ratio of 4.64, while higher than some peers, is justified by the company’s strong return on equity and capital employed.
Compared to the broader transport services sector, where valuations can be stretched due to speculative growth expectations, VRL Logistics offers a more balanced risk-return profile. Its EV to EBIT ratio of 15.41 and EV to capital employed of 2.86 further reinforce the company’s efficient capital utilisation and operational leverage.
Investors should note that while some peers like Delhivery and Blackbuck are trading at very high multiples reflecting growth optimism, VRL Logistics’ valuation is grounded in solid fundamentals and consistent earnings generation.
Risks and Considerations
Despite the positive valuation shift, investors should remain mindful of sector-specific risks such as fuel price volatility, regulatory changes, and competitive pressures from both organised and unorganised players. The recent 3.36% decline in the stock price may reflect short-term profit booking or broader market sentiment.
Additionally, the company’s 52-week high of ₹579.20 indicates that the stock has experienced significant price swings, which may not suit all risk profiles. However, the current very attractive valuation grade suggests a favourable entry point for long-term investors willing to tolerate some volatility.
Conclusion: A Compelling Opportunity in Transport Services
VRL Logistics Ltd’s recent upgrade in valuation attractiveness, combined with strong profitability metrics and a favourable Mojo Grade, positions it as a compelling investment within the transport services sector. The stock’s reasonable P/E and P/BV ratios relative to peers, alongside robust returns and dividend yield, provide a solid foundation for potential capital appreciation.
While sector headwinds remain, VRL Logistics’ disciplined financial management and operational efficiency offer investors a balanced risk-reward proposition. The current market environment and valuation reset present an opportune moment to consider adding VRL Logistics to a diversified portfolio focused on quality small-cap transport services companies.
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