Allcargo Terminals: Powering India's Logistics Growth

[ashwind]

Allcargo Terminals Limited (ATL) is one of India’s leading players in container freight stations (CFS) and inland container depots (ICD). With strategically located facilities across major ports, ATL plays a critical role in managing containerized cargo efficiently.

ATL’s Nationwide Network - ATL has 7 operational facilities across India, with combined installed static capacity of 26,300 TEUs providing essential logistics services. It has a strong presence in key locations, including JNPT (Mumbai), Mundra, Chennai, Kolkata, and Dadri (ICD). It has 2,350+ Employees (355 on-roll & 2,000+ contracted) as of 31st Mar 2024.

Current Capacity and Expansion Plans

Facility	Static Yard Capacity (TEUs)	Acreage	Warehouse Space (sqm)	Distance from Port
ATL JNPT	4,000	43	37,500	18 KM
Speedy JNPT	5,000	53	34,616	6 KM
ATL Mundra	3,000	16	12,000	8 KM
Speedy Mundra	6,500	40	18,750	8 KM
ATL Chennai	4,000	24	4,645	9 KM
ATL Dadri (ICD)	1,800	10	5,245	1.5 KM (Rail)
ATL Kolkata	2,000	17	2,622	2.5 KM
Total	26,300	203	1,15,378

Expansion Plan: ATL is investing in additional capacity at JNPT and has acquired 60 acres in Mundra and 25 acres in Chennai for further growth.

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Services Offered by ATL

ATL provides a range of logistics services to ensure smooth cargo movement:

Containerized Cargo Handling – Managing import and export containers
Break Bulk Cargo Services – Transporting non-containerized goods
Bonded & Non-Bonded Warehousing – Storage solutions for different types of goods
Reefer Monitoring – Specialized tracking for temperature-sensitive cargo
Hazardous Cargo Handling – Safe transportation and storage of hazardous materials
ISO Tank Services – Facilitating movement of liquid cargo
First & Last Mile Delivery – Seamless cargo transit from origin to final destination
Direct Port Delivery
Specialized Cargo Handling

Need for CFS & ICD:

• CFS & ICDs act as hubs in the logistics chain of a multi-modal transport logistics system.
• Helps in decongestion of ports by shifting cargo and customs related activities outside the port area
• Enables consolidation and desegregation of LCL cargo
• Provides handling, storage and value-added services
• Maintains shipment data and acts as serving point for shipping lines
• Optimization of transport and inventory cost

ATL’s Digital First Approach has helped improve efficiency through the myCFS portal, which enables faster document uploads and clearances.

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Financial Highlights (Q3 FY25)

ATL continues to show steady financial growth, backed by operational efficiency and strategic investments.

Financial Metric	Q3 FY25	YoY Change	QoQ Change
Revenue	₹ 187 Cr	↑ 1%	↓ -4%
EBITDA	₹ 32 Cr	↑ 11%	0.1%
PAT	₹ 12 Cr	↓ -19%	↑ 4%

Key Business Updates:
ATL acquired 15% stake in Speedy Multimodes, making it a 100% subsidiary
Secured six-year lease extension for Speedy Mundra facility
Capacity expansion in JNPT with an additional 22-acre lease

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India’s Growing EXIM Trade & ATL’s Role

India’s trade is growing rapidly, and ATL is well-positioned to benefit. Key factors supporting growth include:

GDP Growth – India’s economy projected to grow at 7.0% (FY25) & 6.5% (FY26)
Port Expansion – Govt announced Wadhavan Port (₹9.2 billion investment)
Dedicated Freight Corridor (DFC) – Faster, more efficient cargo movement across the country

ATL’s ICD Jhajjar will capitalize on NCR’s container traffic, providing cost-efficient logistics solutions.

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Strategic Investments & Future Growth

ATL is actively expanding its presence through smart investments:

Investment in HORCL – ATL purchased 7.6% stake to tap into DFC connectivity
Growth in Multi-Modal Logistics Parks (MMLP) – Expanding into Farukhnagar, a key logistics hub
Stronger Synergies with Allcargo Group – Integrated warehousing and contract logistics

With an asset-light strategy, digital transformation, and strong financials, ATL is building a future-ready logistics network that supports India’s global trade ambitions.

Reference: Feb 2025 Presentation Link

Disclosure: Took a small tracking position when this was demerged and listed in end of 2023. Currently in watchlist as valuations look attractive.

[FIRE]

I’m curious why the promoters are selling at the current price levels, especially since the valuations seem quite attractive for buying. What’s your take on this?

[Vikas2412]

These are going to be the key areas to watch in the upcoming results of Q4 FY 2025 on the 14th May.

[Vineet_Bhatia]

i had this share in my portfolio when it was trading near 10x cashflows (around 30-32) - that time - the management mentioned that the biz model will remain asset light and they will build assets in a different entity which will be leased to them. the stock eventually went 2.5x from there.

but as more quarters passed key things changed in management focus-

1. business changed from ASSET LIGHT to ASSET HEAVY
2. the 100cr cash which was lying on the balancesheet was transferred to its parent company in lieu of an investment which parent had. (clear cut case of related party transfer) - shareholder money lost to parent company
3. since model changed to asset heavy - they plan to now take 500cr loan for further expansion - which will again kill the cashflows.
4. promotors sold off shares and marquee investors exited.

please be mindful - its a low margin business if done as capex heavy business - the ROCE will be lower than many good businesses available in market.

disclaimer: exited at 41 after management announced for loan for capex.

[Power_Lord]

Hi Vineet! What do you mean by Asset Light to Asset Heavy? How can they just transfer the funds to the parent company in lieu of an investment just like that?

[Vineet_Bhatia]

It’s all in concalls and announcements, you can follow my comments easily by going thru them

[ashwind]

Last 3 years Blanace sheet shows they are Asset Heavy, not Asset light.

They purchase stake of “Haryana Orbital Rail Corporation Limited” from Allcargo Logistics in 2024. This does not look like they got Fixed assets, but a stake in an entity reponsible for executing/implementing rail infra in Haryana around Delhi. I am of the opinion this is a strategic stake, not sure how ATL will leverage this to get better business decisions. This will take a long time to play out.

[Arun_G]

A good part of ATL’s assets is in the form of Right of Use assets. They have been using leased infrastructure. More than 70% of their non-current assets fall under this.

The purchase of a minority stake in HORCL from Allcargo Limited is said to give them ready access to rail lines when HORCL builds those lines and is considered critical to ATL’s operational performance. A minority stake cannot give them legal rights, but it looks like the 7.6% stake somehow helps the company influence how fast and where HORCL builds the rail lines (wonder how?).

This is a capital commitment for core business performance, and a commitment of some ₹115 crore in this manner, which is about a year’s EBITDA, makes the model asset-heavy in spirit.

If one looks beyond accounting technicalities and into business substance, there is a shift from what was communicated earlier to the line of thinking now.

Disclosure: Own ATL

[Vineet_Bhatia]

Hi Ashwin, all the benefits of strategic investments , influence etc were any ways achievable as it’s part of parent entity.

The transaction was solely to tranfer cash from one entity to other while having same sphere of influence strategically.

Also, it will fall under investments, it’s not asset.

For asset light to asset heavy - you have to go thru concalls when it was demerged and a seperate real estate entity was also created out of allcargo logistics. That time thesis was - all capex will be done in real estate entity and it will be leased to ATL, but now company has decided to take all port assets under ATL only.

While the cash has gone out of books, all the expansion plans are now dependant on future debt. All this While debt cost and repayment will reduce the yearly free cashflows which company was enjoying earlier.

After effect of all this - lower RoCE, lower RoE, while it will boost EBITDA. Let’s see how future pans out.

Waiting for 10x valuation of EBTD