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In a business ecosystem marked by uncertainties following the GST roll-out, your Company completed yet another financial year; confidently holding its leadership position in driving compliance with zero roll-over downtime. While domestic economy has experienced sluggish demand blended with liquidity challenges, the longterm outlook for logistics remains positive and the on-going economic and tax reforms herald a sustained long-term growth for organized players like your Company Specifically the implementation of E-Way bill, will help strengthen your company’s market presence. Furthermore, with the logistics sector being awarded infrastructure status in November 2017, companies like your company can avail infrastructure lending with easier terms and enhanced limits. With the expected stabilization in the overall industry your company remains positive and continues to focus on customer satisfaction and innovative logistics solutions as part of its growth strategy.
The year 2017-18 started slowly as express freight environment was curtailed due to GST implementation from 1st July 2017. As a result, your company’s first quarter topline fell short of expectations. However your Company’s capabilities to scout for right business opportunities amidst this volatility resulted in volumes returning in second quarter. By the end of the fiscal year 2017-18, things seem to have settled down with core businesses not only recovering but also growing. Overall, your company witnessed a growth of 6% in the core express distribution business. E-commerce industry is in a state of evolution with continuous competitive pressure in terms of pricing and volume fragmentation within local geographies.
This is reflected in the performance of your company’s standalone business. During the year, your Company resolved the long pending FCCB’s matter and accordingly converted 14,654 FCCB’s into 1,98,74,225 equity shares and redeemed 7,528 FCCB’s for an amount of Rs. 643.7 Mn.
E-way bill requires significant technology intervention in the everyday goods transportation and it is expected to further push the share of freight volumes from unorganized sector to organized sector. E-way bill requires a logistics provider’s technology platform to be closely synchronized with freight operations and thus will act as a disadvantage for the smaller unorganized players. At the time of the definitive roll-out of E-way bill after initial deferment, your Company was ready with the technology solution required for e-way bill. With the roll-out of GST, Tax-saving centric warehouse locations may become irrelevant and realignment of warehouses will facilitate growth of third-party provided SCM solutions in India. Your Company believes that ‘GST along with e-way bill will take the logistics service sector to next-level growth’.
Your Company has always ‘invested towards developing people skills and capabilities to maintain our leadership position’ in the current competitive market. During the year, your company inaugurated a Driver Training Institute at Hyderabad, in association with the Swarna Bharat Trust, which features a state of the art heavy motor driving simulator and highly trained staff aims to impart best-in-class training to the drivers. Our objective in setting up the training institute is to address the challenge of driver shortage in the logistics industry The Driver Training Institute will provide periodic refresher courses to long-haul and in-city drivers.
Building Sustainable Committee
Your Company believes that it is important to operate in a responsible manner to develop a sustainable business for different stakeholders. In the past few years, your Company has taken up various CSR activities to benefit different communities around us. Over the years, your Company have undertaken CSR activities that are directed towards education, environment, and community development.
Your Company has also introduced the first Gati Electric Vehicle in its fleet and is committed to provide eco-friendly delivery option within network.
Going forward, as the domestic economy gradually absorbs the impact of GST, your company aspires to capitalise on the various opportunities and uphold its commitment towards growth. While the impending elections across many states and the general elections will add to the uncertainties in the business environment, your company is looking at delivery solutions for the future. This will be done through continuous enhancement of the network, an enhanced “GST-responsive” product portfolio, costconscious operations and introduction of innovative service delivery models.
I would like to take this opportunity to thank our shareholders for putting their faith and trust on your company. I would also like to thank our board of directors for their guidance. I look forward to exciting times for the company in the near short-term.
Founder & CEO