TCIEXP - TCI Express Limited Share Price

During the Q1 FY26 earnings call, management of TCI Express provided an optimistic outlook for the company's future, emphasizing their commitment to operational excellence and strategic expansion. They reported a revenue of Rs. 287 crores, reflecting a 6.7% sequential decline but only a 2% year-on-year decrease. The profit after tax for the quarter stood at Rs. 21 crores, alongside an EBITDA of Rs. 33 crores with a margin of 11.5%. Management highlighted several key initiatives and targets for the upcoming quarters.

Looking ahead, management is focused on several key growth strategies:

1. Infrastructure and Network Expansion: They plan to expand their branch networks and integrate automation technologies, with a capex plan of Rs. 500 crores over five years, including Rs. 100 crores expected for FY26 and FY27.

2. Multi-modal Strategy: The company aims to increase the contribution of multi-modal logistics from approximately 17.5% to between 20% and 22% over the next 2 to 3 years. They are emphasizing development in sectors like aerospace and engineering.

3. Sales Growth: Management anticipates overall revenue growth, targeting single-digit volume growth of 8%-9% for FY26, with revenue growth driven by planned price hikes of up to 12%.

4. Festive Season Optimism: There is an expectation of increased demand during the upcoming festival season, which is likely to boost volumes, especially in retail and electronics.

5. Sustainability Initiatives: They are implementing renewable energy solutions and piloting electric vehicles for logistics to enhance operational sustainability.

In summary, TCI Express is strategically positioned to manage anticipated demand through its expanded network and infrastructure, while aiming for an optimized margin recovery and service excellence in the confirmed growth sectors.

Major Q&A from TCI Express Earnings Call (August 20, 2025)

Q1: "While you have mentioned soft tonnage, can you provide the tonnage for the quarter?"
A1: Our tonnage for the quarter was 2.33 lakh tons.

Q2: "What measures are you taking to improve the utilization levels on the Surface Express side?"
A2: Despite a decline in volume, we've maintained 82% utilization. We plan to enhance this as volumes increase and expand our network for Air Domestic, Air International, and Rail.

Q3: "Will growth in the International Air business drive top line growth in the near term?"
A3: Growth will come from all multimodal products, especially as Surface, which is our core, still represents 82-83% of business. We aim for 10-11% overall growth, with Multimodal products driving higher gains.

Q4: "Can you provide a breakdown of your FY26 and FY27 capex plans?"
A4: We are targeting a total capex of Rs. 500 crores for five years. We spent Rs. 200 crores over three years and plan to invest Rs. 100 crores in both FY26 and FY27.

Q5: "What guidance do you have for EBITDA margins and volume growth over the next two years?"
A5: We anticipate single-digit volume growth of 8-9% in FY26, with pricing increases leading to 11-12% growth. By FY27, we expect double-digit growth with EBITDA margins normalizing to 15-16%.

Q6: "What is the current mix between corporate and SME customers?"
A6: We've improved our mix to about 51% corporate to 49% SME, aiming for a balanced 50-50 ratio by year-end.

Q7: "How do you perceive the macroeconomic environment affecting your growth?"
A7: While some segments like Pharma are performing well, others like engineering are flat. We're optimistic about stable costs and a certain business environment which should support our growth targets.

Q8: "How much did Rail Express grow this quarter?"
A8: Rail Express grew by approximately 8% this quarter.

Q9: "What were the price hikes implemented?"
A9: We implemented about 75 basis points in Q1 and aim to achieve another 60-75 basis points in Q2, targeting a total of 2% price hikes by December.

Q10: "What is the volume impact on your performance due to fluctuating trends in Q2?"
A10: Volume in June was lower than expected due to a slump after decent April and May. However, we see improved visibility for Q2 trends going forward.