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TCI Express - On Twin Planks Of Automation, Network: ICICI Securities

TCI Express stands at a vantage point with progressive automation of service centres ushering in cost efficiencies.

TCI Express Ltd. (Source: Company website)
TCI Express Ltd. (Source: Company website)

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ICICI Securities Report

We met the management of TCI Express Ltd., to understand the company’s future prospects and expansion plans. Key takeaways:

  1. Focused solely on business-to-business express delivery segment;

  2. scaling up branch network across India;

  3. automating 10-12 sorting centres (comprising 80% of the business) in order to reduce cost; and

  4. endeavouring to maintain consistent dividend payout to shareholders.

In our view, TCI Express stands at a vantage point with progressive automation of service centres ushering in cost efficiencies and opening of new (own) branches expanding the reach.

As a result, we expect Ebitda margin to expand to 17.5% in FY24 (FY22: 16.2%) and return on equity to sustain between 23-24%. Taking cognizance of higher margins, we are raising valuation multiple to 42 times (earlier 40 times).

Click on the attachment to read the full report:

ICICI Securities TCI Express Visit Note.pdf

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