Detailed Narrative
Q4 & FY26 Performance Overview
Tara Chand Infralogistic Solutions Limited reported a strong FY26 with total income of INR2,881 million, up 13% YoY, and revenue from operations growing 14.9% to INR2,848 million, marking its highest ever annual revenue. EBITDA reached INR1,067 million, a 27% YoY increase, with margins expanding by approximately 400 basis points to 37.05%. Cash PAT also saw robust growth of 27% to INR870 million, reflecting the company's focus on profitability and operational leverage.
Strategic Capex and Fleet Expansion
The company deployed INR1,434 million in capex during FY26, bringing the cumulative capex over FY25-FY26 to INR290 crores, significantly increasing its gross block by 87% to INR558 crores. This investment added 59 new machines, including large cranes and piling rigs, expanding the total fleet to 427 machines with an average age of less than 6 years. For FY27, planned capex is in the range of INR80-100 crores, primarily focused on higher capacity machines and the renewable energy sector.
Segmental Performance and Margin Expansion
The equipment, hiring, and projects segment (Segment A) was the primary growth engine, with revenue increasing 23% YoY to INR1,700 million and contributing 60% of overall revenue. Its reported EBITDA margin improved to 52% from 47% in FY25, with stand-alone equipment rental EBITDA margin reaching 62%. The warehousing and transportation segment (Segment B) grew 9% YoY to INR1,065 million, maintaining 16% EBITDA margins, despite challenges with the new Dankuni Stockyard.
Working Capital and Receivables Management
While net debt-to-equity remained healthy at 0.9 and interest coverage improved significantly to 10.3x, receivable days stretched to 93 days for FY26, exceeding the target of 80 days. This was primarily attributed to the conclusion procedures of the RINL Stockyard contract, with substantial recoveries expected in H1 FY27. Management is committed to bringing receivable days back to around 80 during FY27.
New Subsidiary and Diversification
In Q3, Tara Chand Infralogistic Solutions Limited incorporated Tarachand Metallix Limited, a 100% wholly owned subsidiary with an initial capital of INR25 lakhs. This entity is positioned for strategic diversification into metal processing, focusing on high-frequency beams, fabrication, and value-added metal solutions. While operations are expected to commence in H2 FY28, management views this as a long-term opportunity to stay diversified and explore new avenues for growth.
FY27 Outlook and Growth Strategy
The company targets an annual growth rate of 20-25% over the next three years, with EBITDA margins sustained in the 37-38% band. Segment A is expected to grow 20-25% in FY27, and Segment B by at least 15%. Specialized project services revenue is targeted to push upwards of INR50 crores in FY27. The strategy emphasizes 'scale, specialize, sustain,' focusing on disciplined growth, specialized service contracts, and maintaining strong margins.