Transport Corporation of India - Q2FY21 First Cut - ICICI Securities

(CMP: Rs. 225, MCap: Rs. 1730 crore)

Transport Corporation of India (TCI) reported strong numbers for the quarter, which were higher than I-direct estimates on all fronts.

Q2FY21 Earnings Summary

- Revenues grew strong sequentially QoQ (up 87%), which led to normalisation of revenues YoY to Rs. 612 crore (I-direct estimate: Rs. 558 crore). SCM reported the highest recovery sequentially (up 134% QoQ and up 2% YoY), followed by the Freight division (up 76% QoQ and down 9% YoY) and Shipping division (up 37% QoQ and up 9% YoY)

- EBITDA margins expanded by 63 bps YoY to 9.6%, and came above I-direct estimate of 9%, mainly due to lower employee and also other expenses to sales ratio (lower than estimates by 160 bps and 80 bps respectively), although gross margins negated the improvement to an extent (lower than estimate by 180 bps). The resultant EBITDA grew 4% YoY to Rs. 59 crore, and came above I-direct estimate of Rs. 50 crore

- Further, PAT grew by 29% YoY to Rs. 32 crore (exceptional expense of Rs. 10 crore in the base quarter), and came above our estimate of Rs. 25 crore

As per the management, in-spite of the challenges posed by the pandemic, the company was able to sustain its revenues and margins due to its diversified portfolio of value-added services, spread across varied customers & industry sectors. The company's strategy of providing multimodal logistics solutions helped it cater to not just its existing customers but also acquire several new engagements during the quarter.

We would be coming out with a detailed report post interaction with the management.

Shares of TRANSPORT CORPORATION OF INDIA LTD. was last trading in BSE at Rs.226.2 as compared to the previous close of Rs. 226.35. The total number of shares traded during the day was 875 in over 113 trades.

The stock hit an intraday high of Rs. 229.15 and intraday low of 226. The net turnover during the day was Rs. 199182.

Source : Equity Bulls

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