Any current/future new fundraising through debt or equity?

No decision has yet been made on raising equity capital; if any such plans arise, they will be announced in due course. The Rs. 150-160 Crores CAPEX planned over the current and next year is targeted to be funded through internal accruals and debt. Current secured term loans stand at approximately Rs. 70 Crores and are expected to remain stable over the next few years. The company is paying back around Rs. 30 Crores of debt annually and aims to reduce the debt-to-equity ratio further from the current 0.9 times. Supplier's credit is also utilized, which postpones immediate debt recognition on t

Any current/future capex/capital investment/strategic investment?

The company is planning a CAPEX of approximately Rs. 150-160 Crores spread over two years (current and next financial year), with about Rs. 80 Crores each year. The CAPEX primarily focuses on equipment rental, especially large cranes, to double the net block of assets. Deployment of new equipment is expected to begin from Q2 onwards. Orders for the new equipment have been lined up as per business strategy but specific details are not disclosed. CAPEX for the warehousing segment is limited because existing trailers and machines are sufficient for current contracts. Funding for the CAPEX will be

Future growth expectations in sales/revenue/volumes?

The company targets an aggressive 30% Year-on-Year (YoY) growth in revenue going forward. Growth is expected to be distributed across both warehousing & logistics and equipment rental sectors, with potentially higher growth in equipment rental due to greater CAPEX. New order wins, especially in equipment rental, are anticipated in Q3 and Q4, traditionally strong periods. Sustainable EBITDA margins are projected between 50%-55% for equipment rental. The company aims to maintain or improve current yields, with better visibility on yield increases expected by Q3. Plans to expand into renewable en

Future growth expectations in earnings/operating earnings/profits/EPS?

The company targets an aggressive 30% Year-on-Year revenue growth going forward. Growth is expected to be evenly distributed across warehousing & logistics and equipment rental sectors, with potentially slightly higher growth in equipment rental due to more CAPEX. EBITDA margins for equipment rental are expected to sustain between 50% to 55%, with overall company EBITDA around 33% aimed to be maintained or improved. New orders and contracts pipeline is strong, with order execution periods of 5-7 years for warehousing & logistics and 6 months to 3 years for equipment rental. CAPEX of ~R

Current/ Expected Orderbook/ Pending Orders?

Current order book stands at Rs. 138 Crores. Order book composition: 55% from warehousing and logistics, 45% from equipment rentals. Equipment rental orders usually range from 6 months to 3 years, extendable. Warehousing and logistics contracts typically have an execution period of 5 to 7 years. Anticipated surge in new orders during Q3 and Q4, especially in equipment rental segment. Company targets aggressive 30% YoY growth in FY’25 supported by new order pipeline. New contracts tend to be long-term with execution ongoing, some new contracts started in May ’24. The Company actively participat

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Tara Chand Infralogistic Solutions LtdQ1 FY24Commercial Services & Supplies

Tara Chand Infralogistic Solutions Ltd Q1 FY24 Earnings Call Analysis

Revenue, margin, capex, fundraise and order book outlook from management commentary.

Price: ₹57.1P/E: 16.6Market Cap: ₹460 CrSector: Commercial Services & Supplies

Management growth scorecard

Revenue

Category 2

Margin

Category 3

Fundraise

Order

Yes

Capex

Yes

2 of 5 growth signals are positive.

Full analysis

Revenue guidance

Category 2

→The company targets an aggressive 30% Year-on-Year (YoY) growth in revenue going forward.
→Growth is expected to be distributed across both warehousing & logistics and equipment rental sectors, with potentially higher growth in equipment rental due to greater CAPEX.
→New order wins, especially in equipment rental, are anticipated in Q3 and Q4, traditionally strong periods.
→Sustainable EBITDA margins are projected between 50%-55% for equipment rental.
→The company aims to maintain or improve current yields, with better visibility on yield increases expected by Q3.
→Plans to expand into renewable energy sector leveraging existing fleet capacity, potentially boosting revenue mix.
→Continued focus on long-term contracts with stickiness due to specialized services and innovative handling techniques ensures steady volume growth.
→CAPEX of around Rs. 80 Crores per year planned for fleet expansion supporting revenue growth.

Margin guidance

Category 3

→The company targets an aggressive 30% Year-on-Year revenue growth going forward.
→Growth is expected to be evenly distributed across warehousing & logistics and equipment rental sectors, with potentially slightly higher growth in equipment rental due to more CAPEX.
→EBITDA margins for equipment rental are expected to sustain between 50% to 55%, with overall company EBITDA around 33% aimed to be maintained or improved.
→New orders and contracts pipeline is strong, with order execution periods of 5-7 years for warehousing & logistics and 6 months to 3 years for equipment rental.
→CAPEX of ~Rs. 160 Crores planned over two years to support growth, mainly in equipment rental, with deployment starting Q2 onwards.
→Company expects steady profitability supported by escalations clauses in contracts mitigating cost risks.
→Efforts focus on sustained profitability and margin stability rather than only top-line expansion.

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Fundraise plans

→No decision has yet been made on raising equity capital; if any such plans arise, they will be announced in due course.
→The Rs. 150-160 Crores CAPEX planned over the current and next year is targeted to be funded through internal accruals and debt.
→Current secured term loans stand at approximately Rs. 70 Crores and are expected to remain stable over the next few years.
→The company is paying back around Rs. 30 Crores of debt annually and aims to reduce the debt-to-equity ratio further from the current 0.9 times.
→Supplier's credit is also utilized, which postpones immediate debt recognition on the books, allowing manageable repayment schedules.

Order book

Yes

→Current order book stands at Rs. 138 Crores.
→Order book composition: 55% from warehousing and logistics, 45% from equipment rentals.
→Equipment rental orders usually range from 6 months to 3 years, extendable.
→Warehousing and logistics contracts typically have an execution period of 5 to 7 years.
→Anticipated surge in new orders during Q3 and Q4, especially in equipment rental segment.
→Company targets aggressive 30% YoY growth in FY’25 supported by new order pipeline.
→New contracts tend to be long-term with execution ongoing, some new contracts started in May ’24.
→The Company actively participates in new tenders and evaluates contracts strategically.
→CAPEX plans aligned with existing orders and visibility on future contracts ensure steady equipment deployment.

Capex plans

Yes

→The company is planning a CAPEX of approximately Rs. 150-160 Crores spread over two years (current and next financial year), with about Rs. 80 Crores each year.
→The CAPEX primarily focuses on equipment rental, especially large cranes, to double the net block of assets.
→Deployment of new equipment is expected to begin from Q2 onwards.
→Orders for the new equipment have been lined up as per business strategy but specific details are not disclosed.
→CAPEX for the warehousing segment is limited because existing trailers and machines are sufficient for current contracts.
→Funding for the CAPEX will be through internal accruals and debt; no decision on equity capital raising has been taken yet.
→The company is maintaining sustainable yields on new equipment investments.

How does Tara Chand Infralogistic Solutions Ltd rank vs peers in Commercial Services & Supplies?

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