TCI Express Q4 Earnings Update: MD Chander Agarwal Outlines Big FY27 Growth Targets | Business News

Added: 2026-05-31

[00:00:05]Hi there, good morning. You're watching Midcap Masala on ET now. I am Sneha and this is a show where we are going to be focusing on the broader end of the market. Tell you everything that's happening. Nifty is taking a little bit of a tumble from the day's high continues to be absolutely flat. 23,900 is a level that we've held on to. 23,912 is where we're at right now. the broader end, the small cap basket is doing much better, outperforming the nifty by quite a lot, 610 of a percent higher, but the midcap index is absolutely flat with a hint of a negative bias. And that's the kind of setup that we're seeing in the broader end right now. But let's shift focus and in fact get right into the conversation with the managements from the broader end of the company. The first one that we're going to be interacting with is the management of TCI, Transport Corporation of India on the back of their quarter for earnings, which by the way were a very good set of numbers. So let's get into conversation with Mr. Chandra Agarwal, the managing director at TCI Express. Mr. Agarwal, hi morning. Thanks for your time. Morning.

[00:00:59]>> Let's start by talking about your FI27 uh guidance. You've guided for 10 to 12% topline growth. Talk to us about what is the outlook over here and what are going to be some of the key levers that you'll be using to achieve this.

[00:01:13]So we're uh projecting 10 to 15% growth top line >> and uh that will be uh in in line with our clients, our customers and industry verticals that we are working with uh the pharmaceuticals uh the automobiles and uh the solar and uh uh all the uh defense and all the new age uh industries that are our clients will also be part of that growth prospect.

[00:01:42]effect u we we we expect that uh the surface segment to be growing uh at a much faster rate than the previous year and all our new products also growing uh in in in double digit growths growth rates >> okay sounding good and um can you talk to us about when we look ahead to FI27 we've spoken about revenue but what about your margin trajectory in FI27 and talk to us about which segments are going to be the outperformers.

[00:02:14]So margin will also increase uh sequentially and uh we are not seeing any uh disruption happening there even though you know we have the uh the the war going on and the diesel price have uh increased but it's a relatively easy uh easier pass on for us and uh we are not uh uh uh and and and that is also partly because we don't have a very large credit cycle uh that helps in you know uh managing the cash flows quite well. Uh the segments again we will be seeing that the uh the surface cargo segment and even the air cargo segment will be a prime uh uh uh component for our margin expansion.

[00:03:00]>> Okay. And uh Mr. U G when you say that it's easier to pass on the cost for you on the back of the war impact are you talking about price hikes? Have you undertaken any >> the diesel? Uh yes we have already uh taken a few uh price hikes and uh we are in the process also it's continuous process actually we're not doing it just one time and you know falling back on uh the uh the existing prices uh because since we have a large customer base uh we have to ensure that you know throughout the all the new agreements and the the previous agreements and all the uh uh existing uh uh agreements we are able to increase the price which can take time but uh it's done effectively >> responded to well by your customers any slowdown in demand on the back of these price hikes >> you know fortunately that's the uh the good part that we have not seen any slowdown and uh all the sectors that we operate in are doing quite well uh comparatively to last year >> that sounds good start talking about some of your segments Mr. Jagarval, let's start by talking about road to rail that is clearly gaining some traction for you. How meaningful can this become for TCI over the next two to three years especially when uh DFC is ramping up.

[00:04:22]>> So we not doing a shift from road to rail. We providing an additional service in the rail car. So it's like a you know it's a uh the of course the uh the task would be to have an integrated service uh of the road and the rail but that's again a humongous challenge in India with the uh you know the infrastructure missing and all the uh the DSC not able to you know uh connect the the the far away locations to the rail network. But uh I see that the real DFC benefit will come for the exports where uh the uh containers which take about almost 2 weeks to go from north to west India will substantially reduce by uh a week.

[00:05:12]So uh hopefully that uh that is going to be the saving grace of the DFC uh and and and not so much as a uh comparison or uh substitution for the road network.

[00:05:27]>> Okay. And uh speaking of the seaway segment that's been a strong performer for you yet again and also on the broader um macro impact or or the macro front rather with co coastal shipping getting policy support now how big can the seaway segment become uh for you in the next few years and what part of your overall revenue mix can come from here?

[00:05:49]Uh that again will be uh subject to you know the uh uh the authorities I mean the the shipping uh uh ministry what they are able to you know uh prospect us in terms of the benefits like you know like a zero tax or you know the foreign vessels not able to apply. So all of these factors will determine uh how the industry will shape up and of course the business is subject to how many more vessels we add and that will be uh uh that is an ongoing process >> and on that Mr. Straval in terms of your vessel addition your capex is also stepping up meaningfully including ships and network expansion talk to us about what the capex plans for FI27 look like and what kind of return thresholds are you targeting on these investments >> we looking at uh I mean in a broader term uh uh through internal capex and borrowing we probably for TCI express we'll uh actually we will not be borrowing but it'll be all through internal uh uh acrals uh and invest ment of close to almost 120 crores and that uh will be done uh on you know uh the network as you mentioned and getting of new sorting centers and creation of new sorting centers in automation and of course technology will be playing an important role in this uh investment as well.

[00:07:13]>> Okay and Mr. Sagal going ahead do you see operating leverage kicking in as your volumes rise or do you believe that competitive pricing will keep your margins rangebound given the kind of competition that we're seeing brewing in the sector especially on the freight front what's your outlook there >> so uh the we always have a leverage on uh uh the opex because we don't own any assets we don't own any drugs so therefore it's easier to kind of like uh scale up and scale scale down depending on demand and uh like that we are seeing that uh definitely uh a 1 or 2% increase in EITA margins and we would like to take it up back to the levels that we were earlier at.

[00:07:58]>> Okay. So understood and point taken very well. Thank you so much Mr. Agarwal for your time. It's been good interacting with you. Congratulations on the quarter that you've seen and good luck for the quarters to come. On that note viewers, it's time to slip into a very short break on this edition of Midcap Masala.

[00:08:11]More conversations lined up on the other side. Stay tuned and we'll be right back.