TCI Express Q3 Results Review - Weak Operating Performance: Motilal Oswal

Motilal Oswal Report

TCI Express Ltd.’s Q3 FY24 revenues stood flat YoY at ~Rs 3.1 billion (8% below our estimate). The volumes were adversely impacted by the weak macroeconomic environment, muted festive demand, and the long holiday season during the quarter. Volumes in Q3 FY24 stood at 0.25 million tonnes (-1% YoY), while realisation stood at Rs 12,474 per ton (flat YoY and down 2% QoQ).

Ebitda for the quarter stood at Rs 456 million with a margin of 14.6% (versus our estimate of 16.3%). Margins were adversely impacted by lower volumes handled.

Profit after tax stood at Rs 356 million (versus our estimate of Rs 391 million). During nine month FY24, revenue stood at Rs 9.4 billion (up 2% YoY); Ebitda stood at Rs 1.4 billion (up 1% YoY); Ebitda margin stood at 15.2% (flat YoY); and adjusted PAT stood at Rs 1 billion (flat YoY). TCI Express handled 0.74 million tonnes of volumes in nine months FY24 (down 3% YoY).

The company generated cash flow from operation of Rs 750 million in nine month FY24 with CFO-to-Ebitda ratio at 51%.

We reiterate our 'Buy' rating with a revised target price of Rs 1,450 (based on 30 times FY26E earning per share).

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