TCI Express Ltd
NSE:TCIEXP
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 |
827.8
1 421.2
|
| 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.
This alert will be permanently deleted.
TCI Express Ltd
You don't have any saved screeners yet
Ladies and gentlemen, good day, and welcome to the TCI Express Limited Q2 FY '23 Conference Call hosted by PhillipCapital India Pvt. Ltd. This conference call may contain forward-looking statements about the company, which are based on the beliefs, opinions and expectations of the company as of the date of this call. These statements do not guarantee the future performance of the company, and it may involve risks and uncertainties that are difficult to predict. [Operator Instructions]. I now hand the conference over to Mr. Vikram Suryavanshi from PhillipCapital. Thank you, and over to you, sir.
Thank you, Inba. Good evening and very warm welcome to everyone. Thank you for being on the call of TCI Express Limited. We are happy to have the management with us here today for Question-and-Answer Session with the investment community. The management is represented by Mr. Chander Agarwal, Managing Director; Mr. Pabitra Panda, Chief Operating Officer; and Mr. Mukti Lal, Chief Financial Officer. Before we start with the question-and-answer session, we'll have opening comments from the management. I will hand over the call to Mr. Chander Agarwal for opening comments, over to you, sir.
Thank you. Good evening, everyone, and welcome to the Q2 Financial Year '23 earnings call of TCI Express Limited. I would like to thank you all for joining us here today. To start with, I will give you an overview of the industry and business for the quarter, and then we'll hand over the call to our CFO, Mr. Mukti, to brief on the financial performance for the quarter.
Our earnings presentation has been uploaded on the website and stock exchange, and I have you at now to look at it. The first half of financial year '23 continued to see a recovery in overall macroeconomic scenario guided by strong government initiatives to some decline. The trend was visible in many economic indicators like index for industrial production, GST collections, stock market indices and report from external rating agencies. During the quarter, we saw an overall improvement in output for the month of July with marginally declined in August, primarily due to declining manufacturing and mining sector.
The era base generation is another factor that indicates the performance of the logistic sector. Overall, the Evatel generation was kind of ended up on a strong note, reaching INR 7.6 crores driven by season demand at a growth of 152% over pre-Covid period. Given this strong economic environment, the logistics sector continued to expose recovery trend. TCI Express being the market leader in express trucking logistics delivered the highest quarterly revenue of INR 300 crores, registering a growth of 22.2% year-on-year and 6.8% on a sequential basis. The top line growth was primarily driven by the SME customers higher volume of our services. Automation of the sorting centers also substantially increased the daily capacity by reducing the passive holding time and the labor involvement resulting in enhancement of complete operational efficiency and strong sustainable margin. EBITDA for the quarter was INR 54 crores with a strong margin of 17.2% as compared to 15.3% previous quarter. EBITDA margin was primarily on account of higher capacity utilization and operational efficiencies.
Coming to business update. During the first half of the year, we have incurred a total CapEx of INR 50 crores, which have been primarily spent towards the purchase of land in Kolkata and also network expansion by adding a growing market. The automation and the digitization will enable us to be much more efficient and in continuation, deliver superior customer experiences to enhance also the operational efficiencies. By leveraging our asset-light structure with automation and digitalization, we continue to enhance our competitive position as a leading provider of express services. Our newly long services are also growing state, and we expect these services offerings to contribute productively to the top line in the forthcoming quarters, enabling us to deliver higher margin levels.
From a balance sheet perspective, we continue to maintain strong capital structure, providing us the financial flexibility. We continue to focus on balanced capital allocation and strengthening our network. In view of a strong performance in the first half of the year, and please announce that the Board of Directors have recommended an end dividend of INR 3 per share with a payout of 51% and 50% on the face value. Looking ahead, the industry remains positive grow strong as the growth of logistics sector is fully aligned with the India's economic growth potentially. With Rivigo policy push aided by the strong economic recovery, we remain confident in our ability and our superior product offering, we will further help us benefit from these upcoming growing opportunities. With our customer-first focus and innovation within asset-light business model, we remain confident of our superior value-added services to retain our leadership position.
With this, I'd like to hand over now to Mr. Mukti to talk about our financial performance for the last quarter. Thank you.
Yes. Thank you, Chander and now I would like to discuss the financial performance of the company. And during the last quarter, our revenue from operations stood at INR 310 crores for Q2 FY '23 as compared to INR 90 crores in Q1 of FY '23 and INR 273 crore in Q2 FY 2022. Total income for the quarter was INR 312 crores as compared to INR 292 crores in Q1 of FY '23 and INR 276 crores in Q2 FY '22, transiting into a sequential growth of 7% and 13% year-on-year basis. This significant growth is attributed to multiple factors like growth in demand from SME customer's improvement driven by automotive sorting center, higher capsulitilization, increased demand from rural areas and festive seasons. So overall, the total income for the first half of the year is INR 605 crores as compared to INR 500 crores last year, posting a strong year-on-year growth of 21%. We witnessed a strong improvement in EBITDA and margin as well. And the EBITDA stood at INR 54 crores with margin of 17.2% in comparison of 15.3% in the previous quarter.
So I am happy to report that for the first half of the year, our EBITDA is around INR 19.5 crores as compared to INR 81 crores in the same period of last year. So the net profit for the company in Q2 is INR 38 crores with a margin of robust margin of 12.1% as compared to INR 31 crores and margin of 10.6% in Q1 FY '23 and INR 34 crores and margin of 12.3% in Q2 FY 2022. Overall, net profit for the first half is INR 69 crores with a margin of 11.4% registering year-on-year growth of 19%.
As far as our future focus is concerned, we will continue to invest in technology and investment automation to drive a more efficient operation and provide a superior customer service. We invested a CapEx outlook outlay of INR 50 crores during the first half of the year towards the ago. The ongoing automation and digitization, which will enable us to be much more efficient in delivering superior customer experiences and enhanced case efficiency in the long run, which enable us to deliver industry-leading performance by leveraging our satellite sector structure, with automation and utilization, we continue to enhance our competitive position as a leading provider of logistics services.
So going by the festival demand trend and governments post in improving the overall connectivity across the country, I'm highly optimistic of higher depilation and better conjunction from our new offerings like better contribution from our new offerings like pharma, cold chain, C2C express and rail express. The impact of these changes will be reflected in our financial performance in forthcoming quarters. Now thank you very much. And now I would like to open the floor for question and answer. Over to you, [indiscernible].
Thank you very much, sir. [Operator Instructions] First question is from the line of Amit Dixit from ICICI Securities.
I have a couple of questions. The first one is on the tenants. What was the tonnage in Q2 FY '22? And the second question is on working capital. So net working capital days they were higher in this quarter, possibly due to higher receivables. Do you see the possibility of this reversing? And if so, what could be the net working capital tied by the end of FY '22? These are the quick questions, sir.
So late numbers in this quarter for this quarter is 247,000 tonnes. And in half year, it is 477,000 tonnes. And the second question -- you asked for the working capital days, yes, that has increased by almost 9 days. And it is a very temporary because what happened in the last month of this quarter was the highest revenue we have achieved. That's why this was a temporary impact on that. Another aspect of that in Sundry creditor, we have had some vendor on early on due to the festival season. So once it will be made on some early payment to them. So that's why they just like a temporary impact in Sundry creditor days and debtor sales. So it will be normalized. And I think in Q3, it will be normalized back to kind of like 48 to 50 days in a receivable days and 35 days in creditor side. So net working capital cycle will be back to 14 to 16 days.
Sir, basically, INR 29 crores, I think, was locked up in receivable in this half year. So you are saying that as the year go this also will be normalized?
Yes. This will be also normalized. It may be like you rightly said, it increased by INR 29 crores. It may be increase of like by year and maybe INR 10 crore, INR 15 crore net in overall basis.
Our next question is from the line of Alok Deora from Motilal Oswal.
Congratulations on great numbers, especially on the margin side. Sir, just wanted to understand on the volume trend, how it has been? And how is the festive season shaping up for us looking at the numbers, it seems to have been pretty good, just because in some sections of the logistics segment, we have been hearing of some slowdown in September. So just your thoughts on that?
I don't see there's a slowdown as such compared to other sectors. But in general, the economy is doing quite well. And in fact, most of the sector verticals we are in, you have not seen any sort of like a complete slowdown or anything of that sort.
Sure. And also, just wanted a sense on how is the Gurgaon sorting center has been coming up because I understand that first couple of quarters after the commissioning would have been more of a testing period of time. So just how is the feedback been and...
It is already up - we've already done the maximum like the impact has already been seen of labor reduction of trucks that the time it takes for the trucks to outtake earlier, the holding to get. But this has to be now expect other locations to really get another unit set of benefits coming in. So if you look at location A, B and C, if you only do this from location A and then you don't do it in B, so you get only half of that benefit. So it's very imperative that we do that location B also going so that if the vehicle is halting, say, 12 hours or sorry, 24 hours on each side, and then that means is like almost 48 hours, then -- and we were able to reduce it in 8 hours. So we had a successive savings right dividend. So that sort of benefit will come as we keep going further into expanding automation into other serving centers. This Gurgaon been performing very well. I mean I invite all of you where we can visit this plan. And so you can really see what we are talking about.
Sure, sure. And just a last question. So how are we looking at deploying the automation at other centers like Pune and how we going to replicate that to other centers? Any update on that or any strategy we [indiscernible].
So all our of course, our goal is to cover 10 all 10 or major 10 to 11 in the next 4 to 5 years. And of course, the learning curve comes down with every sonic center that we built, but the Auto Giga. But the office with the land and with the land acquisition and all of that is something that takes you in time also. So then of course, the construction, like our Gurgaon having centers has slowed for because of the pollution norms and construction has been housed agenda. So I think in regional areas. So I think these sort of challenges are -- it's always going to be where in India, and we have to deal with that. So in looking at that, I think the 4, 5-year plan that we have is kind of like a way to achieve it.
Sure. Just last question. So these margins of 16% or 0.5%, 16.6%. That's how are you looking at that in the second half? Would it be at similar levels? Or could it further improve from here?
Still it will 100% further improve and there is no demand in that. I mean there has to be always there is no reason for it to come down because like as I mentioned, the economic conditions and everything the inflation, everything seems to be modern and with that, there's no reason for the margins to come down.
The next question is from the line of Krupashankar NJ from Spark Capital.
Just a couple of questions from my side. First on the automation front, challenge, you have mentioned that the turnaround time, of course, is very automation coming through service centers. But with respect to margin improvement, given that our trucks are paid or vendors are paid on a per kilometer basis. So the margin improvement, what would be the key drivers, if I like to understand?
Sorry can you repeat last line, what you said?
So what are the margins a -- so for example, you do highlight that the margins will expand because of operation. And that is more or less translating into a shorter turnaround time. So what are the key drivers given that you are paying the vendors on per-kilometer basis? So the turnaround time should not matter with respect to margin profile. So can you explain a little bit of detail on that side?
Yes. Well. So basically, as Chander has mentioned, we had a halting time right now in the range of 20 to 24 hour on both ends, like origin sorting center and destination sorting center. So supposing they're making a kind of like they haven't creating a month from particular A location to B location. Now we're able to reduce their edge. Now we have reduced the holding time on a location fee. That means their trip will be increased in a particular month. So they will be saving on their fixed costs, like, again, driver salary and insurance and truck cost efficient everything they will be saving because and their inflow will be increased. So there will be -- whatever savings they will be had, they will be -- they are sailing with us like they have done in the time of where we increase the axle load in these trucks and the whatever savings they have because then they have shared with us. Same way, we are doing for this one. This is the one aspect. Second aspect, obviously, we also are able to reduce the labor component on the center. So that is also a part of direct cost and it will be also reducing on that.
Right, got it.
We are enhancing customer satisfaction level and it is a high turnaround time. So itself high turnaround time is doubling the capacity of this existing center. We can be like process of double triple cargo in the same center by arranging or managing this speed of machine because this now is a completely automated one. So in a various sense, it is giving a high efficiency to us, like you will be wonderful like we can be adjusted the speed of this movement of cargo in this -- for that shorter. Like supposing in lead time, we can reduce the speed in high time, we can be a like increase speed. So accordingly, cargo will be processed on that. In this sense, it is being a very good kind of efficiency in this system overall. In a part of like efficiency improvement and also like reduction in cost also.
So the order right of Gurgaon be fully and followed by Chennai and then I think can you just is on what are the key sorters, which will be coming in for the next 2 years in the cycle. I mean a commissioning itself by FY '22?
Yes. So basically, we are trying to negotiating for the now. We started the negotiation for Pune, then it will become for Chennai, Kolkata, Mumbai. These are line. And obviously, I think by 2025, like 3 years down the line, we will be having 5 more in the last 3 years.
Understood. Thanks. And with respect to the load factors on the truck side, can you just apart for the quarter?
The load factor in this quarter is 85%.
85%. Okay. And is there a guidance with respect to or rather a revision in the guidance with respect to revenue and margin for FY '23 and if at all, for 24?
So whatever guidance we had given in inception of this year, we are still on the same path. We will be certainly achieve 18% to 20% revenue for the full year. And same way, we are also looking for FY '24. And we obviously -- we want to enhance our margin level. So margin level in this year, we are planning to be have on full year basis 17.5 and then next year again in the range of 18 plus.
Thank you. Our next question is from the line of Sagar Bhatia from Prabhudas Lilladher.
Sir, quickly just want to know the detailed...
Mr. Bhatia, if you are on a speaker mode, can you please switch to handset and speak your audio is a bit muffle sir?
Okay. Is this better? So quickly, I just want to understand the cold chain in business and what margins are you looking at over there going forward for the next year?
Yes. Cold chain business, we're just doing the pharma cold chain business. We are not doing other businesses of food or other grocery items. We are not doing that. Other things we are also not doing the warehousing. We're just doing the taking refrige truck, we are moving. So margin level in the truck is also in the range of 18% to 20%, and we are doing for the only pharma customers. Next year onwards, this will be also the same -- we are looking for the same margin level. Because again, if you see like we carry like this perishable item, we maybe not have that much margin, but we are just scaling that these high value medicines, high-value vaccines, everything we are getting high value.
That's why margin level, we are able to impact to in the range of 18% to 20%. Other aspects of that because we have a big branch network across India. So we -- that's why, again, same way like we are doing in a surface truck. We are able to fill these trucks back to also like supposing one truck has moved from Pune to Delhi. Then again, we have a cargo for the Delhi to Pune. So that's why we are able to generate a good margin level. And again, it is also same way, it is asset-light model. We are not owning or not planning to own any trucks on our balance sheet.
Our next question is from the line of Ravi Naredi from Naredi Investments.
Thank you, Chander. Really, you are doing a fabulous and extremely well. Sir, our market share is 7% in India, which you show in investor highlight, where we can see in next 5 years, this 7%.
Thank you for your encouragement. Now I can tell you one thing that the market is so vast and 7% to 10% is what we said -- now with the new that is the policy coming up, there's still easily grow to 15% to 18%. Now the fact is that how do you determine that? Because government doesn't give a data for GST collection of 18% versus 5% and all that. So if you really see the expectation, of course, I mean, obviously, it will mean a regarding market share in the larger portion of the economy is becoming formalized. It's coming into a GST and as well we will see our market share also increasing in the organized segment.
Okay. But you will not be able to quantify, right?
See, it's very early because you have to see your goes got over the war just started. What is one year on and...?
War impact is not on India, at least...
But we are getting affected right but high fuel prices. And that is also the inflation not this year, but globally. So it's only -- and we -- I mean if India has not done the deal and we will be looking at observed prices, oil prices and inflation. So there are multiple factors that we can watch out for.
And sir, in quarter 2, how much volume growth and how much price growth at?
Yes. So volume growth is in quarter -- sorry, year-on-year basis was 12.5%. So price increase hardly is 1% of that.
1% only, okay sir. And in buyback, we are not offering any share in the market, right, promoter?
So we are buying the shares from the market regularly.
Yes, yes. Yes, I knew. But promoter is not going to sell any shares, right?
Yes. Promoter is not participating in this buyback.
We will take the next question from the line of Radha from B&K Securities. Please go ahead.
Congratulations on consistent performing. Sir, my first question was, so we have reported around 7% Q-o-Q top line growth. So what are -- I believe that auto pharma and cap goods are the primary sectors that you're doing it. So what are the underlying sectors that have some highest growth in the demand?
So Radha, you are right, you rightly said auto is a major contributor, auto and retail sector because this is a festival season, the pre Deepawali has gone. So retail and lifestyle products and electronic items, they are a major contributor in that. And pharma is slightly kind of flat.
All right. Sir, my next question was, I believe that in FY '23, we were estimating to take around 3% price hike and 1Q, maybe we were not able to take, but how much prices have we taken in this quarter? And how much can we expect more for full year?
So we have -- till time, we have taken almost 1.5% price high. And by year-end, we are targeting to have at least 2.5% to 3% price hike for the whole year. That is we are planning, and we are planning. So again, it is a very systematic process. These agreements with the customers is renewing in each year, rollover basis, annual basis rollover and wherever we come for the renewal, we are asking for a hike from the customer. And we keep doing that. There is no challenge on that.
So with respect to price hikes, given that we are in infection scenario and all. So what do you see -- how are peers performing in this area? Are you able to take price sizes as well as you? Or is that a gap?
No. So you have rightly said, there's -- sometimes customer is pressurizing not to increase our price to other their cost has also increased, obviously like various costs. So that's why we are also very cautious and don't want to be unnecessarily pressure customers. So wherever it's possible, and we're seeing various aspects their business volume and which sector they are giving the volume whether they are fulfilling our return lower and also various site after seeing then we are putting that price hike.
All right sir. And how much revenue is from value-added services for first half FY '23?
It is around 16% of overall revenue.
Okay, sir. And my last question was previously, we were of the thought processes that we did not increase revenues from e-commerce given that they're not that profitable. So are you still on the same stand? Or is there some change seen in the sector, given that some of the players have reached concerns with respect to growth in e-commerce. So what is your perspective on e-commerce as of now?
Our stand is the same. We will not touch it because we know that it is not profitable and it will in our B2B business.
We'll take the next question from the line of Mayur Parkeria from Wealth Managers India Private Limited. Please go ahead.
Good evening, sir. I'm audible?
Yes.
It looks like Mr. Parkeria line is disconnected. We'll wait for him to rejoin. In the meanwhile, we'll take our next question. That's from the line of Prit Nagersheth from Wealth Finvisor.
One question I wanted to ask you is that you give quite an update on the Gurgaon Sorting Centers. But one aspect is that do you -- have you -- have you finished all the complete implementation of it? Or is there something remaining on the go Gurgaon site?
It's all done. It's all complete the study in time.
And have you achieved all the goals that you have in mind?
All the investors, there's a big group coming to see it [indiscernible] coming, so you can do them also.
Okay. Good enough, too. But my question is that have you achieved all the key objectives that you had with that sorting centers?
Yes, yes. So yes, so we -- that's why we have taken a long time because the first time we have launched this automation in B2B industry in India. So we make a lot of studies. And then finally, we are able to stabilize everything just onwards. And so we have done, like we have stabilized the process of vehicle movement for like my brands to have and then sorting centers, the timing, everything like labor reduction of labor, but optimization we had done like we are also putting like weighing scale there for now. We have a kind of weight management also we have done. So everything, I think whatever we have put a component to be made there as we list out and then everything has been achieved now.
Right. The reason I'm asking you this [indiscernible]. Based our ESG gold with it. It is 100% solar proof; I mean solar light that also the green certificate for it. So it's like one of the most important sorting centers that have come up, and we make ten of these at that. Okay. That's great. Sir, so the reason I was saying second this half was because maybe this means that this was your first launch.
I can't hear. Can you speak louder?
I'm sorry. Can you hear me? Is it better?
A little better.
A little better, yes. Yes. Okay. So now that all your SOPs are in place and all the learning's on is, would you say that the next effect that you're building for Pune, you would be able to achieve what we did with Gurgaon much lesser timing.
What will be, sorry?
Whatever you are looking to achieve in Pune, you will be able to achieve it in lesser time frame than what you did with Gurgaon?
No. Because it's not Gurgaon, it's Pune. It has its own challenges. It has its own micro and macro environment. So everything is very -- our country is very dynamic invest is different, north is different, central different.
Sure, sure, sure. Okay. So there any insight on the C2C and the rail express how is the traction on these 2?
No, B2C is average. There's nothing we are doing in that B2C you are doing. And rail express is doing very well for us. And I meant C2C that how we are doing with the C2C.
Yes. So C2C, yes, it is, again, in this segment, and we are doing well. And the business is increasing like if you talk about in this quarter, so it is increasing the around 14%. And this is growing well, and it is also like giving the similar kind of margin to us.
Okay. And what about rail express, is that -- is the traction going? Have you started new routes as you are planning to?
Yes, yes. So we have actually given the update in our earning presentations also, so that route has increased, the number of customers has increased. Now repetitive customers now a various number of customers are repetitive now in the nature. So they again and again using this survey. So this is getting attraction and is going fantastically well.
Thank you. We'll take our next question from the line of [ Ayesh Shah ] from Elara Capital.
Congratulations for a great set of numbers. So first question was that Chander you have mentioned that we have added 22 branches in this quarter. So how many branches are we planning to add in FY '23 and '24? Also, if you could provide any particular geography that we are concentrating on?
Yes. So basically, in this half year, we added almost 22 branches and majorly are in North and West -- majorly one in the west and then north. And the remaining 6 months, we are planning to be open in the numbers around 50 number we want to be open. And in FY '24, again, it is -- we want to open 100 numbers. So basically, we expanding wherever we -- before opening up any branches, we do the study there, whether we Vibe solution or is really -- and another aspect to see we have to see it has to go on a particular route where our track existing sets going on. So additional costs would not be increased on -- to carry the material from that branch to my sorting center and vice-versa. So these various aspects we are saying and then opening up the branches.
So basically, we are going to add 72 branches in FY '23, which is lower than 100 that you were targeting. So any reason for the deviation of some?
No, nothing as usual thing, we became making the study and then opening up some time is not possible, sometimes it's possible, yes.
Okay. Next one, can you just give us the contribution of retail SMEs and large accounts for this particular quarter? And what are the targets that we are planning to achieve on that front?
Yes. So basically, in this quarter, particularly, it is a 52% to 48% ratio, 52% is from SME and 48% from big customers. And then for the whole this half year, it is around 51% and 49%. So always our endeavor to be maintained to 50%, though it is very easy to increase our business from a big customer because they're giving the big volumes. But we have to be balanced out of both things to maintain our margin level and fulfill factor in micro. So that's why we are taking a very balanced approach always.
Okay. And last question. So after the Gurgaon center, we are planning to build Kolkata center. So how long will that take? I mean, I think the land acquisition has been completed. And could you give the time lines for the other sorting centers also like Nagpur, Chennai and Mumbai?
So before Kolkata, because Kolkata we just for the land, it will take the time to start the construction because eastern sector has there still has some more challenges than other parts of India for approval and everything. So first, Chennai be first come to that. And then subsequently, Kolkata will come and then Mumbai, Ahmadabad and Nagpur will come.
Okay. So Chennai will come in FY '23 or FY '24?
It will be mid of next year, FY '24.
Our next question from the line of Mayur Parkeria from Wealth Managers India Private Limited.
Sir, thank you again for taking my question as I got disconnected. Sir, on -- again, on the Gurgaon center actually, when I joined, there was a question already going on, so I may have missed a part of it. I had the question on the same side. The parameters which you must have said earlier, some of the benchmarks and milestones. Is there any major changes in which where your expectations have not been met as far as what we had earlier anticipated in terms of either efficiency or in terms of cost structure? Just as an experience.
Not really, but we are facing challenge on Mayur because -- this is a visa-versa also like we sending the truck to my other destination there, they do not have any automation. So sometimes they get delayed the things to unload and load the things. So subsequently, this trend will be also then resale. So we are putting a parameter what time they should be reached and must be getting the like priority there on these centers. So it really reached back to my center back. So these challenges with just testing and putting some strict SOP to fulfilled by all the other centers basically -- that's I think challenge we have. Otherwise, we already met all parameters and is running very smooth.
Okay, great. Sir, I know it may be a little directional statement, but just to -- we want to get a little more clarity on that. FY '25, we said around INR 2,000-plus crore turnover is our target. We are at the INR 1,200 crore run rate on an annual basis. You said FY '24, we can still target 20%, but the ask rate then for FY '25 would be substantially higher at 40%. Is that a fair way to read or because from INR 1,200 crores 2,000 is a 30% plus ask rate, whereas for FY '24, if you are at only 18%, 20%, then FY '25 ask rate will be much higher. Is it because more centers will come up? Or is there a directional -- just a clarification there, sir.
Yes. So basically, if you see us, Mayur this is not the right -- this is not the correct thing. What you're saying -- in this year, this run rate in this quarter was INR 310 crores, and next 6 months, we'll be getting around INR 675 crores kind of revenue will be get in next 2 quarters. If you see the trend, we have our Q4 is the highest revenue quarter. So we are targeting at least have like INR 1,275 crores, INR 1,300 crores revenue. And then special will be that rate will get reduced by 20% in next year, then it will become INR 1,600 crores, and then obviously 20%, 25% will become INR 2,000 crores. That's why we are seeing because we already have -- we are ready for the next growth level. Like we launched the services in last year only, and they are maturing now customers. We are finding new customers. We already for the different independent team do we get businesses in new -- these new streams or new services we have launched like rail C2C and cold chain pharma. And we are also like adding up the branches.
Now this automation is also obviously help us to get customers -- good customer experience on that. So if you put together all things, we are on a right path, obviously, and a part that we also will be taking like price hikes also from customers, supposing in next year, inflation is not so high. So we will be able to take slightly more price hike from the customer. So it all depends. But yes, we're sincerely making the effort to be become a INR 2,000 crore company by 2025 with the EBITDA margin level of 20%.
Sir, wish you all the best for that. So I had just one last question for Mr. Agarwal a little strategic question from a broader term. Sir, we have increased our total services now if you look at whether it's a normal B2B expressed C2C now added rail added coal chain added rail. So many -- the segments are more and more segments are increasing. So from a management perspective, do you think that it will be from a customer standpoint, is it an integrated service offering? And hence, there is no need to add no segment or SBU level precedent kind of or senior management? Or do you think that at some point of time, we will have to require 3 heads to lead each vertical because they will have an independent offering and need to be driven independently. From a structure perspective, how do you foresee as the sale is also improving, sir?
You got that right. As the business volume and the business itself grows, then there will be definitely like an independent had running that business?
Okay. Okay. Sir and do you see that forcing in the next 2 years? Or will it be faster?
Okay. So I'm not the kind of non the kind of company that will just add manpower is for -- so we will see how the business is goes, and then we will do it.
Our next question is from the line of Sumit Jain from ASK Investment Managers.
Just wanted to know what is the margin differential between our SME business and large corporate?
Yes. So it is actually significant differences there like in retail. And if you talk about big customers, so it is almost a gap of 25% to 30% in general sense, I'm saying though because, again, depending on sector-to-sector segment wise like always engineering goods is giving higher margin in comparison to retail business. So various dynamic factors also there. But in general sense, yes, it is almost 25% to 30% difference is that.
Okay. And when you said 58% is the mix, this is by volume or by value?
I said its 52%.
52% by value?
Yes.
Thank you ladies and gentlemen, that was the last question. I now hand the floor back to the management for closing comments, over to you, sir.
Thank you all for participating in tonight's event. And we are really excited about the opportunity that awaits us in the next half of the year for the financial year. And then look forward to speaking to everyone again accordingly. Thank you very much and over to you Mukti.
Thank you, everyone.
Thank you members of the management. On behalf of PhillipCapital India Private Limited, that concludes this conference. Thank you for joining us and you may now disconnect your lines.