ValuePickr Forum

TCI Express - Logistics Sector niche player

Does anyone has Q1FY18-19’s concall transcript?

Company stock was up more than 7% today. Is there any news or development? Or is it part of mid-cap recovery? Anyone has any inputs? Thanks.

Company acquires about ~8% of a Japanese e-commerce shipment tracking tool / app / software company.

Translated page.

Way it works - only pictures provide some clue; unless it can be translated.

Results are out.

Company presentation to exchanges. The company will be debt free by Q1
FY2020

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Thank you @ramanhp

This is one of the consistent performing company in my portfolio :slight_smile: .

Slide 16#

TCI xps is carrying $9B which is just 5% of market share . They have potential to bring business from unorganized segment (95%) . A major positive factor them as well as the other organized players in the market.

The split of road/rail/water/air - 60%/32%/8%/0.1% seems to be pretty decent and government focusing on sagarmala may actually move the needle towards water. an increased % may be expected in the upcoming years.

The air traffic may increase once UDAN is in place all tier-2 & tier-3 airports and ATF fuel price are reduced. A long way to go in this area.

Slide27#

Real good news of company being debt free in Q1 FY2020.

Slide 28#

free cash flow zooms :slight_smile: :slight_smile:

Slide 29#

ROE goes slightly down but ROCE goes up.

Slide 30#

income from operations goes up 15.7% Y-O-Y with Margins up by 11.6% . Though the margins are improving Y-O-Y still a long way to go to reach decent 15% plus

Overall company seems to be on the right track and are abreast with developments in logistics business.

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This should help improve operational performances and Margins.

[TCI Express: Margin show drives up Q4 numbers]

Q1 2020 results out

The following are highlights Y-O-Y

  1. Sales up by 8cr
  2. Expenses up by 5cr
  3. Net profit up by 2 cr (13% up)
  4. No major change in margin %

Annual Report (2018-2019)

During the recent Tamil Nadu Investor Association meet, I presented this stock idea. It is meant only for discussion purposes.

Hope people may find it worth reviewing.

Disc.: Invested and Advised TCI Express.pptx (1.2 MB)

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Got intrested in this due to very attractive balancesheet and return ratios as well on of good investor friends recommended to have look. Here is feedback of my due diligence and scuttlebutt -

  • With entry of new startups like Revago, Delhivery etc this field has become competitive.
  • Most of the players source thier vehicles from open market
  • Usually OEM negotiate contract annually with clasue for price variation based on fuel prices.
  • All have more than one supplier for express delivery.
  • Everyone has his own route of strength and where they can offer better rates than competition due to return load availabilty.
  • Reliabilty and safety are hygine criteria and prices do matter.
    ( Disclosure - Exploring and not invested)
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What’s your take on competition?
New age logi-tech startups are killing the market. These have large PE backers and deep pockets. TCI is in good growing industry but with many competitors.

TCI Express Q2’20 results out.

Result link -

Investor Presentation-

Key highlights Y-O-Y.

  • Income is 271cr up 9.3%
  • EBIDA is 32cr up 15.1%
  • PAT is 26cr up 60.6%

The revenue growth was driven by increase in Small and Medium Enterprises (SME) customers.

Negligible impact expected on Express due to economic slowdown
❑ Highly diversified client base and well spread across industry verticals
❑ Continuous expansion in Metro and Tier I Cities through new branch offices

Planned CapEx of Rs. 400 crores in next 5 years
❑ Investment in sorting centres
❑ Automation and enhancing technological capabilities

TCI Express became debt free company during the last quarter with surplus funds of Rs. 27 Cr at the end of Sep 2019

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I have noticed TCI Express is part of portfolio and therefore, would like to hear about your views regarding valuations of this stock. Do you use dcf ? or any sector specific valuation multiple to arrive at fair value?
Also, if this does not add any value, please let me know, I shall delete this query. Thanks!

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I entered TCI express as i strongly felt that GST will be a game changer for logistic sector. I was going through many of them like ALLCARGO , GATI , BLUE DART etc and finally on TCI & TCI express.

The management was excellent and they are in business very long time . Between TCI & TCI express i zeroed on the latter as they were in premium segment. Thats very challenging business and they need to continuously innovate / invest in technology to be ahead.

I look less on the ratios and get into financials analysis only when i see something seriously missing in their quarterly results.

Frankly i didn’t expected last quarter results to be so good :slight_smile:

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Same here. I heard the latest con call and felt they are always on their toes to get efficient. Amidst slowdown, they found new clients from the SME sector. The GST regime is slowly but definitely helping them ans they are well prepared too. The latest capex for new sorting centers and automation should bring better efficiency and they have also become debt free.

Disc- Invested at lower levels and plan to hold.

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Lower tax rates contributed to the much higher PAT this quarter. More apple to apple comparison would be PBT.

What is your view on the competition from start ups like Delhivery? It is incurring losses at the moment but has deep pockets with the backing of the likes of Softbank.

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