Navkar Corporation Ltd
NSE:NAVKARCORP
| US |
|
Johnson & Johnson
NYSE:JNJ
|
Pharmaceuticals
|
| US |
|
Berkshire Hathaway Inc
NYSE:BRK.A
|
Financial Services
|
| US |
|
Bank of America Corp
NYSE:BAC
|
Banking
|
| US |
|
Mastercard Inc
NYSE:MA
|
Technology
|
| US |
|
Abbvie Inc
NYSE:ABBV
|
Biotechnology
|
| US |
|
Pfizer Inc
NYSE:PFE
|
Pharmaceuticals
|
| US |
|
Palantir Technologies Inc
NYSE:PLTR
|
Technology
|
| US |
|
Nike Inc
NYSE:NKE
|
Textiles, Apparel & Luxury Goods
|
| US |
|
Visa Inc
NYSE:V
|
Technology
|
| CN |
|
Alibaba Group Holding Ltd
NYSE:BABA
|
Retail
|
| US |
|
3M Co
NYSE:MMM
|
Industrial Conglomerates
|
| US |
|
JPMorgan Chase & Co
NYSE:JPM
|
Banking
|
| US |
|
Coca-Cola Co
NYSE:KO
|
Beverages
|
| US |
|
Realty Income Corp
NYSE:O
|
Real Estate
|
| US |
|
Walt Disney Co
NYSE:DIS
|
Media
|
| US |
|
PayPal Holdings Inc
NASDAQ:PYPL
|
Technology
|
If you don’t study any companies, you have the same success buying stocks as you do in a poker game if you bet without looking at your cards.
Utilize notes to systematically review your investment decisions. By reflecting on past outcomes, you can discern effective strategies and identify those that underperformed. This continuous feedback loop enables you to adapt and refine your approach, optimizing for future success.
Each note serves as a learning point, offering insights into your decision-making processes. Over time, you'll accumulate a personalized database of knowledge, enhancing your ability to make informed decisions quickly and effectively.
With a comprehensive record of your investment history at your fingertips, you can compare current opportunities against past experiences. This not only bolsters your confidence but also ensures that each decision is grounded in a well-documented rationale.
Do you really want to delete this note?
This action cannot be undone.
| 52 Week Range |
57.25
161.05
|
| Price Target |
|
We'll email you a reminder when the closing price reaches INR.
Choose the stock you wish to monitor with a price alert.
|
|
Johnson & Johnson
NYSE:JNJ
|
US |
|
|
Berkshire Hathaway Inc
NYSE:BRK.A
|
US |
|
|
Bank of America Corp
NYSE:BAC
|
US |
|
|
Mastercard Inc
NYSE:MA
|
US |
|
|
Abbvie Inc
NYSE:ABBV
|
US |
|
|
Pfizer Inc
NYSE:PFE
|
US |
|
|
Palantir Technologies Inc
NYSE:PLTR
|
US |
|
|
Nike Inc
NYSE:NKE
|
US |
|
|
Visa Inc
NYSE:V
|
US |
|
|
Alibaba Group Holding Ltd
NYSE:BABA
|
CN |
|
|
3M Co
NYSE:MMM
|
US |
|
|
JPMorgan Chase & Co
NYSE:JPM
|
US |
|
|
Coca-Cola Co
NYSE:KO
|
US |
|
|
Realty Income Corp
NYSE:O
|
US |
|
|
Walt Disney Co
NYSE:DIS
|
US |
|
|
PayPal Holdings Inc
NASDAQ:PYPL
|
US |
This alert will be permanently deleted.
Navkar Corporation Ltd
You don't have any saved screeners yet
Ladies and gentlemen, good day, and welcome to Navkar Corporation Limited Q1 FY '24 Earnings Conference Call hosted by PhillipCapital (India) Private Limited. [Operator Instructions] Please note that this conference is being recorded.
I now hand the conference over to Mr. Vikram Suryavanshi from PhillipCapital. Thank you, and over to you, sir.
Thank you, Nirav. Good afternoon, and very warm welcome to everyone. Thank you for being on a call of Navkar Corporation Limited. From the management, we are happy to have with us here today Mr. Arun Sharma, Chief Executive Officer; and Mr. Anish Maheshwari, Chief Financial Officer.
I will hand over the call to Mr. Anish Maheshwari for opening comments, and then we'll have a question-and-answer session. Over to you, sir.
Thank you, Vikram, and thank you for this call. Good afternoon, and very warm welcome to everyone present on the call. I would like to give insights on the results of current quarter financials of company. Here, I'm highlighting the detail about the continuous operation of the company.
Coming to the total revenue figures of this quarter, the same is INR 105.53 crores for this quarter as compared to INR 103.55 crores last quarter and INR 129.33 crores from last year last quarter -- last year first quarter. The revenue has been increased quarter-on-quarter is 1.21% and decreased by 24%. The major reason being this is the export operations over the port is around 30% decline on a quarter-on-quarter basis and last year quarter basis.
On the revenue figures, the profit after tax of company in this quarter stands INR 3.73 crores in comparison to INR 6.65 crores in last one. Then coming to the profit before the tax, the same was INR 6.30 crores compared to INR 9.96 crores in previous quarters.
Then let's discuss the elements of the revenue of company during the quarter are as follows. In case of CFS PFT, volume of export containers handle stand at [ 13,130 ] TEUs from 28,169 TEUs on Q-o-Q basis and fallen at 35.63% and from 33,811 TEUs on Y-o-Y basis the same as 46.38%. The major reason of fall was when the exports of rice, sugar -- being the exports of rice, sugar and other agro commodities, the position is expected to remain same for the upcoming 3, 4 quarters.
Volume of import containers handle fallen by 5.30% to 28,854 TEUs from 30,270 TEUs on a Q-o-Q basis and the 28,854 TEUs from the 29,590 TEUs on a Y-o-Y basis. The same is slightly lower side by 2.48%.
Coming to the EXIM turnover of CFS, the same is down by 23.79% from INR 64.2 crores to INR 48.96 crores. In case of CFS PFT, the number of trains handled is 181 in this quarter compared to 233 in the last quarter.
And about the domestic turnover for this product is INR 32.02 crores of Somathane and INR 15.87 crores at Udhna and INR 2.08 crores at a Morbi, total making this INR 49.97 crores to company -- compared to last quarter is INR 37.22 crores.
In the case of ICD at Manaba, volume of exports containers handle stands at 2,065 TEUs, whereas import containers handle stand is 216 TEUs. There has been tenfold increase in the TEUs handled in EXIM business. Coming to the EXIM turnover of ICD Manaba is INR 4.8 crores, whereas domestic was INR 2.08 crores, and totaling it's INR 6.88 crores.
Now coming on the profit figures of the quarter 1 FY '23/'24. Operating profit of the continuing business for this quarter stands at INR 37.84 crores as compared to INR 36.5 crores. But when we compare the same with the turnover, the operating margins of our current quarter is INR 35.86 crores in comparison to INR 35.25 crores last quarter, and the operating profit marginally slightly increased.
In spite of the fact, when the EXIM balances are not scared as last year, still, we are maintaining the same profit level. In spite of the fact that Morbi operations where we have a huge losses, because of the operations that we have started in a full swing. Still companies maintaining the same profit.
The profit before tax from continuing operations stands at INR 3.73 crores as compared to INR 9.96 crores on a Q-o-Q basis. This impact on profit due to following factors: the employee cost of business has increased with its current year appraisal and team expansion is INR 3.24 crores, and the finance costs have declined by INR 2.58 crores in this quarter in comparison to last quarter is INR 3.66 crores to INR 1.08 crores. EBITDA margin has decreased to INR 16.15 crores from INR 20.48 crores. This is mainly cause of increase by employee benefit costs.
At last, Somathane was able to maintain steady revenue over last 3, 4 years, even when there was fall in EXIM revenue by 23.79, whereas the compensated by the domestic business of the company, whereas the ICD Morbi has achieved INR 6.95 crores, which is higher by 170.43% or INR 2.56 crores Q-o-Q basis.
ICD Morbi still cover the cost. It is expected that it will be achieved breakeven in upcoming 4 to 5 quarters with exponential growth that is expected to have growth at 15% to 20% for ICD Morbi operations.
Here, I just wanted to highlight about the debt size of company. Company added new fleet of almost 400 trailers in past 6 months and [ 8 ] Reach stackers, and 3 rails. Out of which, we have taken 200 trailers loan, which is in that fact, company has taken INR 80 crores debt. To maintain the Morbi operation, like in a cyclone situation, we got a huge operational opportunity over there, and we add new fleet of 200 containers to achieve the poor movement and which is given the benefit of the straight business side. There, which was, we have a business of INR 3 crores last quarter, which is INR 7 crores this quarter.
Now I just wanted to be open floor for a Q&A session.
[Operator Instructions] The first question is from the line of Ganesh Shetty, individual investor.
Am I audible?
Yes, yes. Tell me, please.
So during the last quarter, we had a very high expectation of good performance for this quarter. But if we compare all the parameters like pain and profitability in spite of giving away entire tech and using the cash which you have got from Adani transaction. That's proved, far away from the expectations with the shareholder or expectation of [indiscernible]. So every quarter, we are expecting something stabilizing of the profitability. But every quarter, we are having some negative surprise also. So I can understand that the business dynamic and the investment which is required. But as a shareholder, it is a regular disappointment for most of us. So can you please throw -- put some light on our future prospects and some stability or some predictability in our profitability for that reason.
So thank you so much. I do agree with you, but I have certain things which I just wanted to be highlight over here to you. Good for the company. Company was 100% debt-free in spite of the situations which we had seen in today's market where the exports are getting down since last 2 or 3 quarters drastically and which will remain continue for the next 2 or 3 quarters.
Good thing for the company, there is a growth which we had seen in Morbi. There are certain parameters, which will have to be taken care well. Like when we are going to start our new operations in a new vicinity where we'll have operational efficiency to be develop in a couple of quarters. It may take another 3 or 4 quarters to take care of our breakeven. But once we will be in a full swing, as we had seen in the past where we have Morbi operations. First 6 quarters, we were not making any profit. We were on the side of maintaining our operating levels itself. And once we were in a full swing, after that, you will see there was a volume of 20,000 container per month, and company was making almost 50% jump in 3 or 4 quarters during the period.
So now if you'll ask me, the negative surprise which we had seen for the company is definitely profit level. And I can say, after Vapi also, our Mumbai operations, during this period also, with the different strategy of our marketing team towards the domestic operations and maintaining the mix of other commodities, where are the other sectors, which we see in export. I just wanted to highlight here when the EXIM mix is not correct, then your profitability will be going very lesser than the comparative period. But still, we are maintaining the same. Our EBITDA level is marginally down.
In absolute number, if you'll see, due to Morbi operations, we were making the sales of INR 6 crores versus we have a total expense of INR 12 crores. So -- and that fact, it will see comparative to other quarters, our EBITDA margins are remain same. But due to the new factor or new facility which we had started last March only, where we will take another 3 to 4 quarters for breakeven. Till the time, that might be a profitability, remain same or in the improvement side slightly. But afterwards, everything will be in operational side, then we'll be in a real safe in next 1 year or 1.5 years, I can say.
Sir, is there any plan to take that for our further working capital or CapEx, because as you mentioned, this quarter, we had purchased some quantity of trailers and are for heading our operations. So can we expect some more debt in the books in the coming quarters to come?
So what I just wanted to tell you about the same, during the cyclone period, there was a huge opportunity for us in a Morbi side, and we were well catering with services to cater the existing operations over there, and we were getting good business from that side. And that's the reason we just take the decision, and we just wanted to try hiring over there a local truck operator, but we were not getting that much of a quantum of vehicles. That's why we just take the decisions, and we just add the fleet.
One more thing I just wanted to add here, last year, till after Adani deal done, we had add 400 vehicles. Out of which, 200 is 100% owned by the company. That was within the cash itself. 8 Reach Stackers, which we just required for the operations, which we added by our own cash. 3 rack cranes, which we added by our own cash. So all in all, you can see the entire operations, when we did started for Vapi, we were having almost INR 300 crores fleet. But right now, with the same fleet, we had only spent INR 80 crores. And against that INR 50 crores, which we are about to receive from Adani. And INR 50 crores, INR 25 crores in this year and next year, INR 25 crores. So total debt, which we added now is INR 80 crores. Out of which, INR 50 crores which we have in hand. So I think so net debt for the company over the period of time, it may be maximum of INR 50 crores for the next 1.5 years.
If there is no such business opportunities received in the coming future, then we'll definitely not going to add any other debt. But if there is a huge opportunity, again, come to us, then we will see on the opportunity side.
Sir, my one request is there. As we are conducting our conference call in the middle of trading session for our market players, so it could be beneficial for the company management as well as the investors if they can just postpone it right at around 3:30 p.m. So that a large number of investors can participate in the conference call, and management can get some overview of the investor perception.
No, sir. We'll taken care of to your point.
[Operator Instructions] Next question is from the line of Kaustav Bubna from BMS Capital.
You have said that you added some debt this quarter. So how much was that quantity?
200 vehicles, INR 80 crores.
You added INR 80 crores of debt, basically, right?
Yes.
Okay. And what is -- and before this Morbi unit, what is, let's say, in 3 years, 3 to 4 years down the line, it operates at optimal utilization, what type of revenues and margins should one expect from an ICD like this?
So down the line, 4 years, as our past experience, it will see in Vapi, 2017 was the first year where we were having a top line of INR 20 crores, and EBITDA was negligible, hardly INR 1 crore or INR 2 crores, I think so. And gradually, after 4 years, you can see when we -- before we sold out, it was having a top line of almost INR 450 crores and EBITDA level around INR 60 crores, INR 65 crores. So we are expecting at the Morbi side the same as down line 3 to 4 years, but it will depend on the situation of the market. It will depend as, if you all see today, exports are almost 30%, 35% down.
Why is that?
Yes. So it's the thing...
Why is it down?
Now it's audible.
No, I'm saying why are exports down?
Exports due to -- globally if you see and agricultural commodity, rice is banned and now sugar is banned, so once the agri commodity, which is not going to be export, and exports -- for exports in Navkar, we are major having exports of agro commodity itself. So sugar earlier, if you see last year, we were having almost 10 to 15 trains volumes in a month, which is all stopped. And which will remain to continue as we got to understand from the market as well as the government entity. It will remain continuing for next 2 or 3 quarters itself.
So you are saying when -- so what you're saying is that, when government comes out and bans the exports to regulate this commodity, Navkar is not gaining -- is not gaining from this -- obviously not gaining from this, because...
Not about Navkar, it's all about industry. So if you see at port side also, there are operations of export is getting down by 30%, 35%.
Correct. Correct. But we are talking about Navkar right now, because it's a Navkar call. So I'm saying Navkar doesn't get harmed by this type of a policy, because you all are directly in this business.
There are 2 different harms. One is the exports, which is not going by the Navkar. There is a business loss. Second, the EXIM is, which is getting changed. One, if I have a good export as well as the import, then my profitability will be a little higher, because we have a good side cargo. Correct. At the same time, if I don't have exports or I have a one side cargo, then my costing will be a little higher side. So it will also impact the EBITDA.
And is your Vapi -- was your Vapi capacity same as Morbi?
It is almost same, sir.
So we can expect around, if everything goes well around the same INR 400 to INR 450 crores in 4 years from Morbi?
Sir, this is our expectations.
And how much are you expect -- how much revenue in Morbi are you expecting to do this year?
So right now, we are at almost -- this quarter, we did have around INR 6 crores revenue. And next quarter, we are expecting around 30% to 40% upside.
Good job. From this quarter?
So it will remain continue for the next couple of quarters, and it will be having a 15% to 20%, I can say, quarter-on-quarter growth.
And you're saying -- see, what, on one hand, you said you won't increase debt. On the other hand, your annual net debt will stay at around INR 50 crores level. On the other hand, you're saying that you may increase debt if the opportunity comes. So I mean, what was the point of...
So basically...
What was the point of becoming debt-free if you're going to build that debt back up?
So basically, you'll have to be understand. If we are having a 15% to 20% growth quarter-on-quarter, then there is no requirement of further debt, that I told earlier too. If there is any new opportunity came, like cyclone was the event that was over there in Gujarat, and then we got a good the opportunity. So I can say you, in last quarter, we have a INR 3 crores revenue versus this quarter, we have a INR 7 crores. And this month might be we will having crossed INR 4 crores. So I just wanted to be -- explain over here is there any opportunity in near future which we get from the existing business houses from there, then we will have to debt. It will all depends.
I will not be wait for 4 years to achieve INR 400 crores turnover. If there is an opportunity, and have reach by 2 years, then I'll have to be lead or smooth my operations.
Fair enough. That's a good point. And just the last question I had. On your CFS business, could you just speak a bit about this business and give us some indication on where it is right now in terms of revenues for the company and margins? And how can we improve this business? And what are the things you're seeing in that business? Signs?
CFS business will remain continue with the same line of action since last 3, 4 years after DPD. So CFS is moreover we have EXIM business, and then we have export mix of 50-50 earlier years in 2000, until 2015/'16. Now the mix has gone down by almost 80-20. So if you'll see quarter-on-quarter, our CFS revenue still remains same, which will be in the range of INR 80 crores to INR 100 crores. And it was last year that when, before Vapi ICD we sold out, we were having almost revenue of INR 800 crores revenue. Out of which, INR 400 crores from our ICD and INR 400 crores from our CFS.
And the CFS revenue has remained same since last 4 or 5 years. There are hardly margin in the sense of 5% to 10% plus/minus. So CFS will remain continue as we were not focusing more on CFS business, because it's a less profitable business. We are more focusing on new commodities like steel, cement, domestic operations, cross business from Morbi to Mumbai, Mumbai to Morbi like tiles -- Morbi, the tile is up. So we are exploring those commodities wherein they are coming to the Mumbai for the export as well as the domestic operation. These are the commodities, which we are more focusing. Steel which is going export from here, JNPT port as well as from Mundra. And the certain facilities were there near our facility, which we just wanted to be catering. So this will be our more focusing area.
And other than that, we are more focused on the cross-selling business, which might be giving us another benefit towards the Mumbai CSL as well as the PFT of Morbi. This is our core strategy towards next couple of quarters.
[Operator Instructions] Next question is from the line of Narendra from RoboCapital.
So just a clarification regarding the Morbi revenues. Sir, is there possibility of...
Sir, your audio is not very clear. Can you speak through the handset?
Yes, is it okay now?
No, still the same.
Yes. Okay. You can take other participant. I'll join back.
[Operator Instructions] Next question is from the line of Shashank Mishra, individual investor.
Sir, my question is that in the last conference call, you have shared that you have to receive INR 25 crores from Adani. In September and October and you have to receive also your piled petition, application for the subsidy of -- from railways of [indiscernible]. So can you please throw some light on this? What is the status of all these payments?
So last quarter, which I told about the subsidiary, which will be from the government of Gujarat. I told the same time, it might be happen in the next 3 or 4 months. We are expecting by December, we try to get it done. It is all depends on the government entity, while they are into the process of understanding of our subsidy papers and all. Once we will get clear all these things, then we'll be getting the right time, which might be taking 2 months' time, which might be take 6 months' time. It was also told by me in last quarter call.
Secondly, which you told about the Adani payment. Adani payment is due in September, and we are expecting that will be received the same in September or max by October. Is there any change, we'll let -- give the sense on the shareholders.
With our experience, Adani is not even delayed a single penny. Whenever it was due, it was paid by them. So with that experience, I can say it's due in September. It might be receive in October, maximum. So INR 24 crores -- INR 25 crores this year and INR 25 crores next year.
[Operator Instructions] Next question is from line of Vikram Suryavanshi from PhillipCapital.
Sir, just wanted to understand our Morbi operation. Last quarter, if you look at, we were waiting for shipping lines, addition of our terminal into their basically port export. And how is the now development and by when you can see that the train operation can pick up for Morbi?
So we can say almost all fitting lines are added over there in Morbi operations. All parties are there started business gradually. And rail operation which you've told about, once all operations will be [indiscernible] once all parties will be having that confidence on us, then that -- it will be gradually improved.
In our Vapi operations, there were so many parties -- when we started Vapi operation, there are so many parties we were refused in first go. And the same which was happened with us in Morbi also. Because there are existing setup with the parties. They don't want to change. But I can say it's a blessings or disaster for us.
When the cyclone came, they were struck in mid operations. And at the same time, we got the opportunity to clear the cargo for the same party. And now those who parties were not entertaining us, they are calling us for their operations. So this is the positive thing part of Morbi operation, I can say.
Secondly, once the operations will smooth and once the operations will be on a higher side, then the railway operations will also be improved.
Got it. And out of, I think, around INR 4.8 crores EXIM revenue we did, how many containers were handled broadly for EXIM?
So Morbi, it will see 2,065 containers. We had doing as exports and 216 for import.
2,065 for EXIM?
For export. 216 for import. So in total it is, you'll see it's 2,281. So Morbi today -- Morbi is more our export focus area.
Understood, okay. And in the JNPT, have we released our number of trains opposed giving up Vapi terminal. How many trains were operating currently?
In total it is 181 trains we handle, comparative to 233, which was in last quarter.
But number of trains we were operating, I think, 13 trains we were operating earlier.
So now we have 16.
16. Okay. Got it.
Next question is from the Lalith Kumar, individual investor. Sir, the line for the participant dropped. Next question is from the line of Narendra from RoboCapital.
Yes. Am I audible now?
Yes, Narendra.
Yes. So you said that it will take 3 to 4 quarters for these operations to stabilize at Morbi. So any guidance for the revenue number for the next couple of years that you could provide?
So as I told you, we are in very early stage to spend time over there. We just started in March 2023, first quarter, which we have around INR 6 crores revenue. And over the period of time, I can see the growth. It will give me an average growth rate might be around 20%. So quarter-on-quarter for next couple of quarters or 3, 4 quarters, it may go higher, but it may take 20%, 25% of the growth. But steadily, year-on-year, it might be in a 20% to 25% growth. So if this year, I'll take almost in a range of INR 30 crores to INR 35 crores of turnover. Then next year, it might be in the range of INR 40 crores, INR 45 crores. So what happens. Once the -- it's said, it all depends on the repeatable customers.
So if some customer is having around 1,000 containers volume in a month, even start with the 100 or 50 containers with the initial operations. Once we're able to do time delivery or serve them better, then they gradually shift our business, which is we have our past history also. So based on that, I can say there are gradual jump on quarter-on-quarter basis. It might be a 1 quarter, there maybe having a 15% jump, and there might be 1 quarter maybe a 10% jump. So year-on-year, there might be 20% to 25%, we are expecting. And it may take around 3 to 4 years' time to achieve the past Morbi business sales.
Yes, I had understood that. I was just asking about on the group level if you could provide it. I mean, all of the ports together.
You are asking?
Yes, all the ports together. All the [indiscernible]
This year, we have first quarter is around INR 103 crores. It might be, I can say, this year, it will be close around INR 450-plus crores, altogether for the Vapi from the Morbi domestic and the Mumbai operations.
Okay. Okay. Got it. And anything on the margin side? Can you provide?
So margin side, I can say, as Morbi is taking shape, it might take breakeven of around 3 to 4 quarters. Once the Morbi will be on a breakeven, then our real margins will be slightly upper side from the earlier past EBITDA level.
So is it fair to assume that the current quarter margins to be the trend for the year?
Yes, yes, it might be same.
Yes. Yes. And also one last question regarding the tax rate. So what's going on there? And what would be the normalized tax rate?
So both the side, Mumbai, we are in reasonable tax level and Morbi will be under marked.
[Operator Instructions] As there are no further questions, I will now hand the conference over to the management for closing comments.
So thank you so much to the entire shareholder community and the resource holders. And we are into the path of, again, new growing capabilities, and Morbi will be the new facility which will be giving us a growth and EBITDA level positive very soon. Thank you so much. Thank you, Vikram, and thank you, rest all of you.
Thank you. On behalf of PhillipCapital (India) Private Limited, that concludes this conference. Thank you for joining us. You may now disconnect your lines. Thank you.