Detailed Narrative
Q2 FY26 Financial Performance Overview
Western Carriers reported Q2 FY26 revenues from operations of ₹440 crores, marking a 6% quarter-on-quarter growth. EBITDA for the quarter stood at ₹19 crores, resulting in a margin of 4.3%, a significant compression from 8.4% in Q2 FY25. Net profit for Q2 FY26 was ₹9 crores, with a margin slightly above 2%. For the first half of FY26, revenues reached ₹855 crores, EBITDA exceeded ₹40 crores, and PAT surpassed ₹20 crores, maintaining a PAT margin of 2.3%.
Operational Highlights and Volume Growth
The company's domestic business demonstrated strong performance, with container volumes surging by over 25% quarter-on-quarter in Q2 FY26 to 21,940 containers. EXIM volumes also showed positive momentum, growing by almost 8% year-on-year in Q2 FY26 to 33,897 TEUs, after facing geopolitical headwinds🌐. Overall, total container TEUs for H1 FY26 grew 2.7% year-on-year to 106,621. The company attributes this growth primarily to domestic demand, with EXIM turning net positive quarter-on-quarter.
Strategic Investments and Capex
Western Carriers completed a capex of ₹30 crores in H1 FY26, primarily invested in heavy equipment, specialized containers, and road assets. The company plans strong capex for the remainder of FY26 and the next financial year, focusing on specialized assets to support its rail-dominated multimodal supply chains. From its IPO proceeds, ₹151 crores were earmarked for capex, of which ₹41-42 crores have been utilized, with ₹110 crores remaining for future investments.
Balance Sheet and Debt Management
The company significantly strengthened its balance sheet, reducing its net debt to ₹8.4 crores, a substantial improvement from ₹228.55 crores last year. This reduction was partly facilitated by the utilization of ₹163 crores from IPO proceeds for debt repayment. Management emphasized that this reduction in leverage positions the company well for future growth and is supported by lower finance costs.
Gujarat Multimodal Terminal & Western India Focus
A key development was the successful completion and commissioning of the Gati Shakti multimodal cargo terminal at Devaliya Station near Morbi, Gujarat. This 30-acre facility handles both container and wagon rake operations, serving industrial clusters like salt, ceramic, chemicals, and MSMEs. New rail services from Devaliya to South and North India have commenced, with expectations of a significant boost in MSME business and growing frequencies, reinforcing the company's focus on western India.
Challenges in Profitability and Working Capital
EBITDA margins saw a notable decline from 8.4% in Q2 FY25 to 4.3% in Q2 FY26, primarily due to higher operational costs, including maintenance, container upkeep, and impacts from EXIM trade imbalances. Working capital days increased to 119 days in H1 FY26, attributed to the acquisition of new MSME businesses, extended payment cycles, and disruptions from GST ratification. Employee benefit expenses also grew 40% year-on-year, while revenue increased only 2%, due to new talent acquisition for expansion, though stabilization is expected.