Sharekhan's research report on TCI Express
Q2FY2025 revenues lagged estimates, led by continued dip in volumes y-o-y. Negative operating leverage and lower truck utilisation led to a higher miss on OPM and net earnings. Company eyes mid-single digit growth in H2FY2025, while it expects to revert to double digit growth trajectory in FY2026. It expects OPMs to revert to earlier levels with a demand revival. Capex plan of Rs. 500 crore over FY2023-FY2027 remains intact, with balance capex of over Rs. 300 crore to be incurred during H2FY2025-FY2027.
Outlook
We retain a Buy with a revised PT of Rs. 1,250, factoring in a downward revision of estimates and expecting a revival in growth from FY2026.
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