TVS Supply Chain Solutions Limited (TVSSCS) has reported a consolidated revenue of INR 2,592.00 crores for Q1, marking a 3.7% sequential growth and a 2.1% year-on-year increase. The company has also launched Project One, a significant restructuring initiative aimed at improving operational efficiency and profitability.

Financial Highlights

• Consolidated revenue: INR 2,592.00 crores (3.7% QoQ growth, 2.1% YoY growth)
• Adjusted EBITDA: INR 173.00 crores with a 6.7% margin
• Adjusted PBT (excluding share of profit from associates): INR 19.00 crores, up from INR 14.00 crores in the previous year's Q1

Project One Restructuring

TVSSCS has initiated Project One, a comprehensive restructuring program combining its Integrated Supply Chain Solutions (ISCS) and Integrated Final Mile (IFM) businesses in the UK and Europe under a single leadership. The program is expected to deliver:

• Annualized cost savings of INR 110.00-120.00 crores
• INR 50.00-60.00 crores in benefits starting to reflect in the future

As part of this restructuring, the company recognized one-time exceptional costs of INR 91.00 crores in Q1.

Segment Performance

1. ISCS Segment

• Revenue: INR 1,982.90 crores (2% QoQ growth, 4.1% YoY growth)
• Steady growth across regions

2. Global Freight Services (GFS) Segment

• Revenue: INR 609.40 crores (9.7% QoQ growth, 3.8% YoY decline)
• Impacted by continued pressure on freight rates and macroeconomic uncertainties

Strategic Investment in TVS ILP

TVSSCS realized significant value from its strategic investment in TVS Industrial and Logistics Park (TVS ILP). The company recorded INR 177.00 crores as its share of profit in Q1, following TVS ILP's transfer of approximately 11 million square feet of developed assets into an InVIT platform.

Business Development

• New business wins: INR 124.00 crores in Q1, representing about 5% of the previous year's Q1 revenue
• Order pipeline: Remains strong at INR 5,300.00 crores

Future Outlook

TVSSCS maintains its target of achieving:

• 4% PBT by Q4 FY27
• Mid-teens revenue growth

Ravi Viswanathan, Managing Director of TVSSCS, commented, "Q1 has been a strong start to the year, driven by disciplined execution. Project One will be one of the key levers in delivering our 4% PBT target by Q4 FY27, alongside the sustained turnaround of IFM and operational leverage across our other regions."

The company remains cautious about macroeconomic uncertainties and geopolitical factors but is confident in its ability to navigate volatility and capture growth opportunities with its diversified portfolio and disciplined cost management approach.

TVS Supply Chain Solutions , a leading supply chain management company, has set ambitious goals for its future performance while reporting impressive quarterly results. The company's shares closed 7.86% higher at Rs 133.98, reflecting positive investor sentiment.

Strategic Transformation and Growth Targets

TVS Supply Chain Solutions has outlined a clear strategy to boost its profitability. The company aims to achieve a 4% Profit Before Tax (PBT) margin by the fiscal year 2027. This target will be pursued through a combination of cost optimization measures, strategic transformation initiatives, and a turnaround in its UK business operations.

Managing Director Ravi Viswanathan expressed confidence in the company's growth prospects, projecting mid-teens growth driven by a robust order pipeline. The company boasts an impressive order book of Rs 5,300.00 crore, supplemented by several large deals in advanced stages of negotiation.

Operational Improvements and Cost Control

To achieve its ambitious targets, TVS Supply Chain Solutions is implementing 'Project One', a comprehensive initiative aimed at transforming its operations in the UK and Europe. This project is expected to streamline processes and enhance operational efficiency across these key markets.

In addition to 'Project One', the company is placing a strong emphasis on cost control measures. These efforts are designed to improve overall profitability and operational efficiency across the organization.

Q1 Financial Performance

The company's first quarter results demonstrate a mixed but generally positive performance:

While revenue showed modest growth and EBITDA saw a slight decline, the most striking aspect of the results was the nearly tenfold increase in Profit After Tax, surging from Rs 7.50 crore in the previous year to Rs 71.20 crore.

Investor Relations and Transparency

In line with regulatory requirements and its commitment to transparency, TVS Supply Chain Solutions held an earnings call with analysts and investors to discuss the financial results for the quarter. The company has made the audio recording of this conference call available on its website, accessible at https://www.tvsscs.com/investor-relations/ .

As TVS Supply Chain Solutions continues to implement its strategic initiatives and pursue ambitious growth targets, investors and industry observers will be keenly watching the company's progress towards its FY2027 profitability goals and its ability to capitalize on its strong order pipeline.