Improving freight demand trends that brought stability to pricing enabled trucking and logistics giant Transport Corporation of India (TCI) to deliver strong results in fiscal year 2016 to 2017 that ended March 31.
TCI’s fiscal 2016 to 2017 consolidated net earnings increased nearly 44 percent to Rs. 81.25 crore (approximately $13 million) from Rs. 56.53 crore in the previous year, according to a company filing with the Bombay Stock Exchange.
Group revenue for the full year totaled Rs. 1,954.87 crore, up 12.68 percent from Rs. 1,734.84 crore previously, the release shows.
"The overall improvement in business environment and our continued focus on value added services have helped us achieve record revenue and margin growth this year,” TCI managing director Vineet Agarwal said in a statement.
Consolidated operating profit from TCI’s core trucking business was up 32 percent year-over-year to Rs. 24.18 crore, on revenue that rose 9 percent to Rs. 1,059 crore from Rs. 971 crore in fiscal 2015 to 2016.
Agarwal expects logistics demand to pick up further steam in the current year with the July 1 rollout of a single indirect tax regime — the Goods and Services Tax. The program is a big ticket economic reform of the Narendra Modi government meant to weed out trade barriers and lower logistics costs.
TCI at a recent transport logistics summit in New Delhi unveiled a plan to collaborate with the National Highways Authority of India for development of multimodal logistics parks in the country. That move comes as New Delhi works toward an “integrated multimodal logistics and transport policy” to switch from a point-to-point transportation system to a hub-and-spoke model that will facilitate the movement of domestic freight on lower-volume corridors.
“With changing consumption trends, we have achieved traction in building additional e-commerce fulfilment centers and expand other niche logistics sectors. We have deployed one more high tonnage ship this year on the west coast to strengthen our national multimodal network," Agarwal said.
The Gurgaon-based logistics provider is known to have a fleet of more than 6,000 trucks and four ships for coastal shipping, supplemented by a pan-Indian distribution network covering nearly 13,000 locations. The group also owns about 11 million square feet of warehouse space.
TCI’s peers, including Allcargo Logistics and Gateway Distriparks, are expected to release their fiscal 2016 to 2017 earnings results in the coming days, which will provide more insight into the upturn in freight demand.