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Container Corporation of India hosted a conference call on Jan 25, 2018 to discuss the performance of the company for the quarter ended December 2017. In the conference call the company was represented by V Kalyana Rama, Chairman & Managing Director of the company.
Key takeaways of the call
The company has upwardly revised the PAT growth for FY18 from 12% guided at the start of the year to about 20% plus now. However the company maintains a volume growth guidance of about 12% for the current fiscal.
Tonnage volume handled in 9mFY18 stood at about 29.12 million tones of which EXIM was about 23.599 million tones. The company controls/enjoys about 73.5% market share with the company's domestic market share gone up by about 200 bps.
Originating container volume for the quarter ended Dec 2017 stood at 567776 TEUs with EXIM container volume stand at 502227 TEUs and Domestic at about 65549 TEUs.
Empty running expenses for the quarter stood at Rs 60 crore compared to Rs 61 crore in the corresponding previous period. The EXIM empty running was Rs 25 crore compared to Rs 35 crore in the corresponding previous period. The company though manages to reduce empty running in EXIM front, the empty running on domestic has increased with imbalance in South North and East-North routes. Empty running for 9mFY17 was about Rs 187 crore down from Rs 201 crore in corresponding previous period. The company reduced EXIM empty running by about Rs 30 crore in 9mFY18.
Overall lead distance for 9mFY18 stood lower at 802 km compared to 872 km in corresponding previous period. The EXIM lead was 728 km compared to 808 km in corresponding previous period.
The company is currently doing 10% of EXIM volumes through double stacking. The company handled double stake rakes of about 492 rakes compared to about 533 rakes in Q2FY18. Double stacking has gone up by about 80% for the quarter compared to corresponding previous period.
Jump in staff cost for the quarter and 9mFY18 is largely due to one-time expenses as the company during the quarter paid arrears on account of wage revision under 3rd Pay commission for PSUs coming into effect from Jan 1, 2017.
EXIM Operating margin (operating revenue less operating exp) for the quarter stood at about 41.78%.
The company has signed MoU with AP government for setting up Integrated Logistics and Manufacturing Zone (ILMZ) at Machilipatnam. The Machilipatnam ILMZ will be spread over 1000 acres. The company is working for more such ILMZ projects in other states. The company will provide complete logistics solutions both input and output for the manufacturing units set up in the ILMZ.
The company has commissioned 2 MMLP in Jan 2018 at Nagpur and Raipur. And commissioning of another 6-7 is on course.
The company is looking at distribution logistics seriously and will start operations soon. The company is looking at 20 logistics centre in next fiscal and it is in the process of identifying locations for it. This will be in asset light model.
East cost volume will grow faster than west coast in medium to long term.
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