TVS Supply Chain Solutions (TVSSCS) Q4 23/24 earnings summary

Executive summary

• ISCS segment delivered strong revenue and adjusted EBITDA growth, offsetting normalization in GFS freight rates; NS segment showed sequential improvement in revenue and margins.

• FY24 saw robust new business development, increased wallet share, and technology-led differentiation, with a growing Fortune 500 customer base.

• Audited consolidated and standalone results for the quarter and year ended March 31, 2024, were approved and found to present a true and fair view in accordance with Indian Accounting Standards and SEBI regulations.

• The company completed its IPO in August 2023, raising ₹600 crore, with proceeds used primarily for debt repayment and general corporate purposes.

• Strategic focus on margin expansion, cost control, and leveraging digital initiatives across geographies.

Financial highlights

• FY24 revenue: Rs 9,200 Cr, down 7.9% year-over-year due to GFS normalization; Q4FY24 revenue: Rs 2,426 Cr, up 4.5% year-over-year and 9.2% sequentially.

• FY24 adjusted EBITDA: Rs 710 Cr, up 3.7% year-over-year; adjusted EBITDA margin expanded to 7.7% from 6.9% in FY23.

• FY24 PAT: -Rs 90.49 Cr (loss), compared to Rs 41.76 Cr profit in FY23, mainly due to exceptional items and higher finance costs.

• Net debt to adjusted EBITDA improved to 2.3x from 2.7x year-over-year.

• Interest cost savings of ~Rs 35 Cr expected annually post-IPO debt repayment.

Outlook and guidance

• ISCS segment momentum expected to continue in FY25, supported by a healthy pipeline and focus on margin.

• IFM business targeted to achieve run-rate profitability by Q2 FY25; cost rationalization measures underway.

• GFS segment to focus on profitability as freight rates normalize; digital transformation and new geographies to drive growth.

• Management emphasized ongoing focus on operational efficiency and leveraging IPO proceeds for strategic growth and debt reduction.

• Medium-term goals: PBT margin 4%, ROCE 16.4% by FY27, aiming for global peer benchmarks.