Gateway Distriparks Limited — Q3 FY25 earnings call

Call held 3 Feb 2025

Management summary

Gateway Distriparks reported a quarter marked by consistent Rail EBITDA per TEU and improved market share in key regions like Sahnewal and Uttarakhand, despite overall market degrowth in Ludhiana and Uttarakhand. The company is actively pursuing expansion with new ICDs and expects significant benefits from the Western DFC completion by end of 2025, which should boost Rail EBITDA per TEU to over ₹10,000. Snowman Logistics is focusing on cost reduction and revenue correction, targeting substantial revenue growth by FY27, while navigating the ongoing Red Sea crisis and land acquisition challenges for new projects.

Highlights

  • Rail EBITDA per TEU maintained at ₹9,600, consistent with H1 FY25.

  • CFS EBITDA per TEU reported at ₹1,270.

  • Double stacking increased to 40% from 38% last quarter.

  • Gateway Distriparks reported an Operating Cash Flow (OCF) of ₹250 crores for the nine months of FY25.

  • CAPEX for Gateway Distriparks for the nine months of FY25 was ₹20 crores.

  • Snowman Logistics targets ₹800-900 crores in revenue by end of FY27, with EBITDA margins expected to stabilize at 18-20%.

  • Market share improved QoQ in Sahnewal (24% to 26.5-27%) and Uttarakhand (23% to 30%), while Delhi NCR was maintained at 17%.

  • New terminal CAPEX of ₹250-300 crores planned for 2-3 new ICDs, with an additional ₹50-60 crores for Jaipur if resolved.

Key financials

2 periods

Headline

  • Rail EBITDA per TEU
    ₹9,600
  • CFS EBITDA per TEU
    ₹1,270
  • Double Stacking
    40%
  • Imbalance (Imports)
    55%

9M FY25

  • Operating Cash Flow
    ₹250 Cr
  • CAPEX
    ₹20 Cr

What they filed

Q1 FY27: revenue down 3.4%, net profit down 25.0% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue384 386 391 380 403 +5%410 +6%385 −2%367 −3%
EBITDA94 92 79 89 95 +1%96 +4%92 +16%87 −2%
Net profit70 57 65 64 69 −1%71 +25%65 +0%48 −25%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

  • Rail
    17% Delhi NCR Market Share27% Sahnewal Market Share30% Uttarakhand Market Share0.02 decimal fraction NCR Market Growth (Q3 YoY)-0.2 decimal fraction Ludhiana Market Growth (Q3 YoY)-0.3 decimal fraction Uttarakhand Market Growth (Q3 YoY)
  • Snowman Logistics
    16% EBITDA Margin

Guidance & targets

Capacity

  • New Rail-linked ICDs Capacity · next couple of years · Medium confidence 2-3
    But there's definitely plans to expand on the rail linked ICD side with 2 or 3 is coming in the next couple of years.

    — Samvid Gupta, Joint Managing Director

Capex

  • New Terminals Capex Capex · when developed · Medium confidence ₹250-300 crores
    So, the two new terminals that we are talking about, it's the same figures we are saying, maybe about Rs. 250 crores to Rs. 300 crores, the total when these are developed.

    — Samvid Gupta, Joint Managing Director

  • Jaipur Terminal Capex Capex · when it comes in · Low confidence ₹50-60 crores
    Jaipur also, when it comes in, that'll be another Rs. 50 crores-Rs. 60 crores.

    — Samvid Gupta, Joint Managing Director

  • Maintenance Capex (Warehouse/Equipment) Capex · next two years · High confidence ₹30-40 crores
    CAPEX of about Rs. 30 crores to Rs. 40 crores for the next two years. This is on warehouse capacity and equipment replacement.

    — Samvid Gupta, Joint Managing Director

Revenue

  • Snowman Logistics Revenue Revenue · by end of FY27 · High confidence ₹800-900 crores
    We are targeting say by end of FY27, anywhere between Rs. 800 crores to Rs. 900 crores of revenue.

    — Ishaan Gupta, Joint Managing Director

Margin

  • Snowman Logistics EBITDA Margin Margin · sustainable · Medium confidence 18-20%
    EBITDA margins though will remain close to what we were around 18% to 20% is what we expected to stay.

    — N. Balakrishna, CFO, Snowman Logistics Limited

Profitability

  • Rail EBITDA per TEU Profitability · when JNPT connects to DFC · Medium confidence ₹10,000+
    Yes, hopefully when JNPT is connected to DFC then we should be seeing Rs. 10,000 plus.

    — Samvid Gupta, Joint Managing Director

Infrastructure

  • JNPT DFC Completion Infrastructure · end of this year · Medium confidence December 2025
    JNPT, the finalizing will only come by possibly end of this year, December 2025 is what Railway is saying, but it could probably take another few months after that also.

    — Samvid Gupta, Joint Managing Director

Risks & concerns

  • Degrowth in specific regional markets (Ludhiana, Uttarakhand) due to commodity dependence.

    medium

    Ludhiana market down 20% YoY due to scrap volumes; Uttarakhand down 30% YoY due to waste paper volumes, with no other voluminous commodities to substitute.

    Management acknowledged

  • Delays in new ICD projects due to land acquisition challenges.

    medium

    Jaipur project delayed over a year due to legal proceedings (Delhi Adjudicating Authority); general difficulty in finding land in correct shape and location for new terminals.

    Management acknowledged

  • Red Sea crisis impacting container availability and freight rates.

    medium

    Ongoing Red Sea issue leads to shipping lines using longer routes, increased freight rates, and erratic container arrivals, affecting empty and export laden boxes.

    Management acknowledged

  • Competitive intensity and discounting in certain markets.

    low

    Ludhiana market experiencing the highest level of discounts (5-15% range), though 80%+ of business has stable pricing.

    Management acknowledged

Areas of evasion (2)

  • Exact rupee savings from double stacking
  • Terminal-wise mix of NCR, Ludhiana, Uttarakhand

Q&A highlights

3 direct
DFC benefits, operational status, and timeline for full Western DFC. Direct
So, we have consistently improved our EBITDA per TEU and running through the DFC coming in. It's there till Mundra, Pipavav for us, but JNPT, the finalizing will only come by possibly end of this year, December 2025 is what Railway is saying, but it could probably take another few months after that also.

Provides clarity on the current stage of DFC benefits and the crucial timeline for JNPT connectivity, which is a key driver for future rail volumes and profitability.

Asked by Kaustav Bubna

Snowman Logistics' net loss, sequential degrowth, and the impact of the Amazon contract termination. Direct
So, with Amazon, after Quick Commerce came in, there was the arm of Amazon, which was Amazon Fresh and Amazon Pantry Business. So, they have changed their model to compete with Quick Commerce. And they are going directly from the suppliers to the dark stores. So, they don't require these dedicated full-serving centers anymore.

Explains the reason behind Snowman's recent performance challenges and the strategic shift in its client base, indicating a focus on smaller distributors and cost cutting.

Asked by Anirudh A. Damani

Challenges in new ICD expansion, specifically land acquisition and the Jaipur project delay. Direct
And the challenge that we are facing is that we are not able to do land acquisitions in the correct shape and in the correct location, which meets all our criterias as we want it. We would rather wait and do the terminal in a good location, such as our Gurgaon facility. And for that, it's taking time.

Highlights a significant operational bottleneck for Gateway's expansion plans, indicating that land aggregation, rather than funding or competitive intensity, is the primary hurdle.

Asked by Jainam Shah

2 min read 5 chapters

Detailed narrative

Q3 FY25 Performance & Market Share Gains

Gateway Distriparks reported consistent Rail EBITDA per TEU at ₹9,600, aligning with H1 FY25 performance, and CFS EBITDA per TEU at ₹1,270. The company achieved a 40% double stacking rate, up from 38% last quarter. Despite overall market degrowth in Ludhiana (-20% YoY) and Uttarakhand (-30% YoY), Gateway improved its market share in Sahnewal from 24% to 26.5-27% and in Uttarakhand from 23% to 30%, while maintaining Delhi NCR at 17%.

Dedicated Freight Corridor (DFC) Progress and Future Impact

The Western DFC is currently operational up to Mundra and Pipavav, with the crucial JNPT connectivity expected by the end of 2025, potentially extending a few months beyond. Management anticipates this will reduce turnaround times to JNPT from 72 hours to 30 hours and is expected to boost Rail EBITDA per TEU to over ₹10,000. While the Eastern DFC is operational, Gateway has no immediate plans for operations there, maintaining its focus on EXIM trade via Western ports.

Snowman Logistics: Strategic Shift and Growth Outlook

Snowman Logistics reported a dip in EBITDA margin to 16% this quarter, attributed to increased labor and electricity costs, and a strategic shift following the termination of the Amazon contract. The company is actively cutting costs and correcting revenues during contract renewals, targeting a sustainable EBITDA margin of 18-20%. Snowman aims to achieve ₹800-900 crores in revenue by the end of FY27, driven by its Snow Distribute (5PL) business and new facility additions.

Expansion Plans and Capital Allocation

Gateway Distriparks is actively exploring 2-3 new rail-linked ICDs, with an announcement expected next quarter, but faces significant challenges in land acquisition. The Jaipur project remains delayed for over a year due to legal proceedings, requiring an estimated ₹50-60 crores upon resolution. Total CAPEX for 2-3 new terminals is projected at ₹250-300 crores, alongside a maintenance CAPEX of ₹30-40 crores for warehouse capacity and equipment replacement over the next two years. The company reported an Operating Cash Flow (OCF) of ₹250 crores and a CAPEX of ₹20 crores for the first nine months of FY25.

Market Dynamics and External Headwinds

The Red Sea crisis continues to impact global logistics, leading to increased freight rates, erratic container arrivals, and a shortage of empty container inventory, which has suppressed overall market growth, including in NCR (2% Q3 YoY). Ludhiana and Uttarakhand markets experienced significant degrowth due to their heavy reliance on scrap and waste paper volumes, respectively. Management noted ongoing discounting in the Ludhiana market, ranging from 5% to 15%, but stated that over 80% of their business maintains stable pricing.

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