Allcargo Terminals Limited , a leading player in the Container Freight Station (CFS) and Inland Container Depot (ICD) sector, has reported a robust performance for the first quarter, with significant progress towards its three-year strategic plan.

Q1 Financial Highlights

• Handled 151,100 TEUs
• Revenue stood at INR 187.00 crores, compared to INR 190.00 crores in the same quarter of the previous year
• EBITDA (excluding other income) increased to INR 35.00 crores from INR 30.00 crores year-on-year
• EBITDA per TEU grew by 22% year-on-year to INR 2,292.00
• Net profit was INR 9.00 crores, slightly down from INR 10.00 crores in the same quarter last year

Strategic Expansion and Growth Plans

Allcargo Terminals has made significant strides in its three-year strategic plan aimed at handling 1 million laden TEUs annually. Key developments include:

1. Successful renewal of the CWC concession in Mundra
2. Regulatory approval received for setting up a new CFS in Mundra outside the SEZ
3. In-principle approval obtained for establishing an ICD in Farukhnagar

The company is expanding its capacity from the current 830,000 TEUs to over 1.3 million TEUs across its facilities. This expansion includes:

• Adding 25 acres to the flagship facility in JNPT
• Acquiring 60 acres of land in Mundra for a new CFS
• Planning a greenfield ICD in Farukhnagar
• Exploring opportunities to increase capacity in Chennai

Financial Strategy and Capex Plans

Allcargo Terminals has outlined a capex plan of INR 450.00-500.00 crores over the next three years to support its expansion. The company plans to fund this primarily through internal accruals and some equity infusion, with limited dependence on borrowings.

A recent proposal to raise INR 38.00 crores through fully convertible warrants has been announced to kickstart the expansion plans.

Market Position and Outlook

The company estimates its current market share at 12-12.5% in the CFS markets it operates in, with plans to grow this by 1-1.5% in the coming years. Allcargo Terminals is optimistic about the growth prospects, citing:

• Expected 6-6.5% growth in India's EXIM trade
• Potential benefits from infrastructure initiatives like the Dedicated Freight Corridor (DFC)
• Anticipated increase in port volumes, particularly at JNPT, from 7.2 million to 10 million TEUs

Management Commentary

Suresh Kumar, Managing Director of Allcargo Terminals, commented on the results: "We have started off Q1 on a strong note. We are well poised to implement our 3-year plan and have crossed the milestones set for Q4 of last year and Q1 of this year successfully. We look forward to completing the rest of the milestones in our 3-year plan and reach our aspiration of handling 1 million TEUs annually in the next 3 years."

The company remains focused on maintaining its industry-leading profitability, with a target EBITDA per TEU of INR 2,000.00-2,200.00, while leveraging its pan-India presence and digital initiatives to enhance customer experience and operational efficiencies.

Allcargo Terminals Limited , a prominent player in the logistics sector, has received a significant tax order from the Commissioner of GST & Central Excise, Chennai South Commissionerate. The order, which levies tax, interest, and penalty under Section 74 of the CGST Act, has raised concerns about potential financial implications for the company.

GST Demand Details

The Commissioner has denied Allcargo Terminals the benefit of exemption under Serial No. 54(e) and 24B of Notification No. 12/2017-Central Tax (Rate) dated June 28, 2017. Consequently, the authority has confirmed a GST demand of Rs 25.29 crore, along with applicable interest and penalty under Section 74(9) of the CGST Act, 2017.

Company's Response

Allcargo Terminals received the order on August 11. In response to this development, the company's management has expressed confidence in its position. They believe that Allcargo Terminals has strong merits to defend against the tax demand and plans to file an appeal within the statutory timelines.

Financial Impact

Despite the substantial tax demand, Allcargo Terminals has not made any provision in its financial results related to this order. The company's management anticipates no impact on its operations or other activities. This stance suggests a high level of confidence in their legal position and the potential outcome of the appeal process.

Regulatory Compliance

In compliance with Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, Allcargo Terminals has duly informed the stock exchanges about this development. The company has reiterated its commitment to upholding the highest standards of ethical conduct and legal compliance.

Recent Performance

While facing this regulatory challenge, Allcargo Terminals continues to show resilience in its operations. According to the company's latest monthly operational update, its Container Freight Station (CFS) volumes for July stood at 52.3 thousand TEUs (Twenty-foot Equivalent Units), showing an improvement from 48.7 thousand TEUs in June.

This data indicates that despite regulatory challenges, Allcargo Terminals is maintaining stable operational performance in its core business activities.