Buy TCI Express; target of Rs 2070: Sharekhan

Sharekhan's research report on TCI Express

TCI Express Limited (TCI) reported lower-than-expected performance for Q3FY2023 as it was impacted by slower economic activities and a lower utilization level during October due to the festive season. The company lowered FY2023 revenue growth guidance to 16-17% y-o-y from 18-20% earlier while OPM is expected to remain flat. However, it retained its volume and revenue growth guidance to 18% and 20% y-o-y for FY2024. It would finalise automation at Pune centre by FY2024. Post that, it would automate Chennai, Kolkata, Bangalore and Mumbai sorting centres over 3-4 years.

Outlook

We retain Buy on TCI with a 12 month revised PT of Rs. 2,070, owing to marginally downwardly revised estimates and lower valuation multiple to factor in current macro sluggishness.

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