UBS has initiated coverage on LEAP India with a “buy” rating, and a price target of ₹175 per share. The price target implies an upside potential of 25% from current levels.
This is also the first analyst recommendation that LEAP India has received after its listing last month.
According to UBS, LEAP operates India’s largest pooled logistics-asset network, offering pallets, containers and material-handling equipment across the supply chain on a rental model.
The brokerage sees LEAP as a play on the modernization of Indian logistics, supported by low palletization and pooling penetration, increasing warehouse formalization and rising demand for supply-chain efficiency.
LEAP India’s revenue could grow at a Compounded Annual Growth Rate (CAGR) of 19% over financial year 2026-2031 and its Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) to grow at a 21% CAGR over the same time period, with a growth mix of movement hire improving pallet yields and asset productivity, UBS wrote in its note.
As a result, UBS expects the company’s EBITDA margins to increase from 49.5% to 53.8% and return on capital employed to rise from 8.4% to 14.7% over the next five years.
LEAP’s nationwide network and scale advantages, position it to capture industry growth, while delivering improving returns and free cash flow.
LEAP India shares listed on the stock exchanges last month at a premium of over 4%. However, the stock is now 11.4% below its issue price of ₹159 and 15% below its listing price of ₹165.9 apiece.
The IPO had comprised a fresh issue of equity shares worth ₹480 crore as well as an offer for sale (OFS) of ₹2,000 crore, taking the total issue size to ₹2,480 crore.
Under the OFS component, the KKR-backed Vertical Holdings II sold its equity worth nearly ₹1,999 crore, while the promoter group KIA EBT Scheme 3 offloaded the remaining stake.
The company’s founder and MD Sunu Mathew told CNBC-TV18 that the company expects its profit after tax (PAT) growth to remain above 50%, supported by lower interest costs as the firm uses IPO proceeds to repay its debt.
Shares of LEAP India ended the previous session 3.4% higher at ₹140.9 apiece. The stock has declined 13% in the past month.
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