Ladies and gentlemen, good day and welcome to the TCI Express Q3 FY 2026 earnings 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 on date on call. These statements are not the guarantees of future performance and involve risks and uncertainties that are difficult to predict. As a reminder, all participant lines will be in a listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touch-tone phone. Please note that this conference call is recorded. I would now hand the conference over to Mr. Vikram Suryavanshi from PhillipCapital. Thank you, and over to you, sir.
Thank you, Muskan. Good evening, and a very warm welcome to everyone. Thank you for being on the call of TCI Express. We are happy to have the management with us here today for a question and answer session with the investment community. The management is represented by Mr. Chander Agarwal, Managing Director, Mr. Pabitra Panda, Chief Business Officer, and Mukti Lal, Executive Director and Chief Financial Officer. Before we start with the call, we will 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. I hope I am audible, loud and clear.
Yes, sir.
Good evening, everyone, and welcome to the Q3 and nine months financial year 2026 earnings conference call of TCI Express Limited. Thank you for joining us today. I hope you and your families are doing well. Our earnings presentation for the quarter has already been shared on the company's website and with the stock exchanges, and I trust you've had the opportunity to review it. I will begin by sharing an overview of our operational performance and business progress during the quarter and nine months ended December financial year 2026. Following this, our Executive Director and CFO, Mr. Mukti Lal, will take you through the financial performance in detail. During the third quarter, the operating environment reflected a mixed trend across sectors. While certain industrial and export-linked segments showed moderation, domestic consumption and festival-led demand supported freight movement.
Against this, TCI Express delivered a stable performance supported by disciplined execution, network expansion, and steady traction across multiple business verticals. On an overall basis, the company reported 6% year-on-year growth for the quarter. Furthermore, as part of our ongoing commitment to shareholder value, we are pleased to announce an interim dividend of INR 7 per share, representing a payout of 350% on the face value. Surface Express continued to remain the largest contributor to overall volumes. During the quarter, Surface Express resumed growth following a period of subdued performance. Performance was supported by customer additions, higher overall wallet share from existing enterprise accounts, and increased movement across sectors as automotive, defense, solar, and electric vehicles. Business from MSME and pharmaceutical customers also improved during the period. Furthermore, during the quarter, we saw an increase in business from key account management customers, reflecting deeper engagement and improved solution alignment.
Customer acquisition remains strong, with registered customer additions more than doubling on a year-on-year basis, supported by focused sales efforts and high field engagement. To strengthen network reach, five new branches were added in Q3 financial 2026. In addition, customer contract renewals are currently underway with revised pricing being implemented earlier than the usual cycle, supporting yield improvement going forward. During the quarter, the Rail Express segment delivered 24% year-on-year growth, aided by higher pharma volumes and technology-led improvements in compliance and shipment visibility. The Air Express business also reported steady progress, with Domestic Air Express growing about 14% year-on-year on the back of customer additions, improved delivery performance, and stronger regional connectivity. While the International Air Express recorded nearly 28% growth driven by higher trade lane activity, customer wins and progress on cargo consolidation and global partnerships.
The C2C Express segment scaled further with 32% year-on-year growth, supported by wider manpower coverage and new customer acquisitions. The E-commerce Express business continued to gain traction, delivering strong growth with consistent volumes across the quarter, stable profitability, and continued progress on B2C expansion, leadership strengthening, and technology integration to support future scale. From a people and process perspective, focused efforts are being taken towards organized business growth and cultural transformation across business associates and logistics staff. As frontline representatives of the company, these teams play a critical role in customer interaction, service quality, and operational outcomes. Structured training and engagement initiatives are expected to improve execution consistency and support long-term growth. During the period, the company has been certified under ISO certifications for ISO 9001:2015, ISO 14001:2015, and ISO 45001:2018. These certifications reflect our continued focus on quality, environmental responsibility, and workplace safety.
We are also pleased to share that TCI Express has been certified as a Great Place to Work for the sixth consecutive year and recognized as India's most preferred brand for 2025/2026. These recognitions reinforce our focus on people, governance, and long-term value creation. Our corporate social responsibility initiatives continued during the quarter. Our health checkup camp was organized for employees at the corporate office in collaboration with Medanta Hospital, supporting preventive healthcare and employee well-being. The TCI Express Foundation's Jaipur Foot & Rehab Centre in Lucknow supported 144 beneficiaries during the quarter by providing artificial limbs and assistive devices, contributing to mobility and long-term rehab outcomes. Looking ahead, the company remains focused on strengthening its core Surface Express network, expanding multimodal capabilities, and deepening engagement across key customer segments. Continued investments in technology, network optimization, and people development remains central to our strategy.
Furthermore, during the nine-month financial year 2026, the company added more than 300 employees to align manpower with network expansion and service requirements. With a strong balance sheet, asset-light model, and disciplined execution, TCI Express is well-positioned to navigate near-term demand variability and pursue sustainable growth in the quarters ahead. With this, now I'd like to hand over the call to Mr. Mukti to take you through the financial performance of the quarter and nine months ended financial 2026. Thank you.
Yeah. Thank you, sir. Good evening, everyone. I will now take you through the financial performance of TCI Express for the third quarter and nine months ended FY 2026. As our managing director has already covered the business environment, service initiatives, and operational progress, I will mainly focus on the financial highlights. For the third quarter of 2026, income from operation was INR 314 crore compared to INR 296 crore in quarter three in last year same quarter, reflecting a year-on-year growth of 6%. On sequential basis, we also increased revenue by 2%. Total income for the quarter was INR 317 crore for FY 2026. EBITDA for the quarter was INR 37 crore compared to INR 33 crore in the same quarter of last year. EBITDA margin for quarter three FY 2026 is 11.6%. Profit after tax for the quarter is INR 23 crore with a margin of 7.2%.
For the nine-month period, income from operation is INR 909 crore and compared to INR 901 crore in corresponding period last year by registering 1% growth in this nine-month period. Total income for the period stood at INR 919 crore. EBITDA for nine months is INR 109 crore with a margin of 11.9%, while profit after tax stood at INR 69 crore with a margin of 7.5%. The nine-month performance reflects stable operating execution despite demand variability across quarters. From a return and efficiency perspective, return on capital employed for nine months stood at 19.6%. Current ratio remained healthy at 3.38 times, highlighting strong liquidity and balance sheet flexibility. Working capital management remained again stable during this quarter. Receivable days has maintained at 60 days, payable days at 39 days, resulting in net working capital cycle of 21 days.
The increase in working capital days compared to the previous quarter is largely linked to the festive season volumes and timing of collections and remains well within the manageable levels. Further, we will try to reduce in time to come in by next quarter. The company continued to operate with a debt-free balance sheet. The net cash position remained strong at INR 146 crore, supporting ongoing investment and operational requirements. Cash flow from operation for the nine months FY 2026 was INR 29 crore. During the same period, the company incurred capital expenditure of INR 45 crore, primarily towards branch expansion, sorting center infrastructure, and IT upgrades. Free cash flow for the nine-month period stood at INR 15 crore. Additionally, the company revised its projected CapEx to INR 400 crore from the earlier plan of INR 500 crore in a five-year tenure, which will be finished in FY 2027.
We will be revised from INR 500 crore to INR 400 crore. So remaining period, we will be done almost like INR 150 crore in 1.5- year time. From a service performance perspective, Surface Express remained the largest contributor to revenue, while Rail Express, Air Express, C2C Express, and E-commerce Express segments supported overall growth during the quarter. As mentioned earlier, investments across multiple services and technology platform are aimed at improving cooperating leverage over the medium term. To summarize the third quarter and nine-month performance reflects a steady revenue growth, disciplined cost control, stable margins, and a strong balance sheet. Our priorities remain focused on prudent capital allocation, maintain liquidity, and strengthening cash flows. With this, I conclude my remarks. We can now open for the floor for the question and answer. Thank you very much.
Thank you very much. We now begin the question and answer session. Anyone who wishes to ask question may press star and one on the touchtone telephone. If you wish to remove yourself from question queue, you may press star and two. Participants are requested to use handouts while asking a question. Ladies and gentlemen, we wait for a moment while the question queue assembles.
The first question is from the line of Kanish Jain from Western Research. Please go ahead.
Hello.
Hello.
Hi. Thank you for the possibility and conversing with us. Am I audible?
Yes, you are audible, Kanish. Thank you.
Sir, I have few questions. The first one is on the SME side. Given the current headwinds faced by the SMEs, could you help us understand how CPR SME clients are to the express group model versus shifting to PTL or other affordable models? Also, so far, have we seen any SME clients move away from us?
Sorry, what I understand, your voice is not clear. You are talking about SMEs. Again, they are facing the headwinds and how they are performing and how they are giving the business to us, right?
Yeah, sir. Since they are facing headwinds, is there any probability that they will shift from express models to affordable models like PTL or other models?
No. SMEs are not hit much. What kind of SMEs we are dealing with, they are prudent one and then fully compliant. They have the full supply chain and businesses across India. We are helping them to deliver everywhere. So our ratio is maintained with them, and we are getting the business from them regularly. Currently, ratio with them is around 49%, and we will keep continue. Again, you have seen in a recent budget, government is also highly focused on to help to these SMEs, and they are also marking some fund to get the direct packages from the SME customers and all. So government is also worrisome about their existence in the system continuously. That is why we also focus our company since inception, focusing on SME customers. So we will keep continue there. Really, they are not moving from express industry to other model.
They have to keep continue with the express because the model is giving the guarantee to deliver on time and with damage free and all. So this way, it is nothing to be worrisome and is very well going on.
Okay. So far, none of our SME clients left us.
No, not at all.
My another. I just wanted to have understanding that about the backend infrastructure. If we were able to win a contract that significantly increase the capacity utilization, would our existing backend infra be able to absorb and service this incremental volume, or would it require further expansion of CapEx?
Can you come again? Your voice is not clear, actually. Somehow is like
Okay. Sir, we just wanted to have an understanding about the backend infrastructure. If we were able to win a contract that significantly increase the capacity utilization, would our existing backend infra be able to absorb and service this incremental volume, or would it require further expansion of CapEx? Was I audible?
Yeah. So basically, you need to see on a three aspect. One is like we had existing infrastructure for the Surface Express and other services like Air Express and Rail Express and C2C Express. So we are creating additional infrastructure to giving excellent services to customers. We are creating infrastructure for Rail Express service independently. We are creating an infrastructure for Air Express, Domestic Air Express and International Air Express also separately. As our MD has mentioned, we are hiring new people for the sales and operation both. So we are future ready for wherever we win any contract. We can get that almost like once we will get the 30%, 40% revenue growth and existing infrastructure is okay. We will do that. But infrastructure is also in a two way. One is my fleet and another one is our sorting centers and branch network.
So sorting center and branch network is fine, but fleet will be added wherever is required because it is a variable component. In existing fleet, we have utilization level is around 83% plus. So this way, it can be increased to 2%, 3% in existing one, but whenever we added the new customer on a very particular line, then we have to add the additional capacity accordingly. Or we shift the capacity from low capacity to higher capacity in existing truck. Again, supposing we are utilizing 16, 17 ton truck, then we can move to 25 ton truck or supposing 9 ton, then we can move to 18 ton. So this way it is happening and it is very dynamic one. So that is not a challenge. Wherever we will grow faster, then we are ready with that.
Okay. Lastly, I wanted to understand the company's priority between improving capacity and top line versus improving margin. For instance, if an institutional client order volume that can significantly increase utilization and top line, but at the cost of lower realization. Would the company accept the trade-off or would we prefer to let the order go and continue to focus on SME clients which offer higher margin but lower utilization and top line?
Our approach is always to get the profitable business continuously. So we will keep a balance, and we maintain that balance since last more than two decades, where we are getting business in 50%/50% from SME and 50% from the bigger customers. So that tendency and that vision, we will be going ahead also with the even newer services, Rail Express and C2C Express, we will give that way. So we will keep continuing with that because again, SME customers are giving the good prices and low volume, obviously. Bigger customers are giving the volumes and slightly low prices. So we have to keep both and keep continuing with that method, actually.
But if you look at institutional clients, the revenue from them are more sustainable [inaudible]. If we look at operating leverage, if you focus on that, then we will also be able to achieve margins from them, right?
So you are talking about SME?
No, I am talking about institutional clients.
No. So institutional client, yeah. So, it is always better to have the SME and both together, actually. That's why if you see, my customer concentration is not so high with one or two customers. As we mentioned time to time, my top 25 customers are not giving more than 15% revenue to us.
Right.
This way, we have very low concentration on a particular customer, so we are not depending upon that, because always big customer or institutional client is always squeezing margins and squeezing the prices. Sometimes they are very highly fragmented to be moved to other service players if they are offering something, some reduced prices and all. But in the express industry, fortunately, this is a very good thing where they don't compromise on a service level, and usually they are not moving much due to price reduction at all. That's why you have seen realization per unit is not decreasing in this industry, in spite of high competition and all.
Right.
This, in a way, is not impacting that way, and it is good to have SME and institutional clients both in this way.
No, I just wanted to have an understanding of what is the company's priority. Is it top line or is it maintaining margins?
No, both.
We take another next question, Mukti.
Yeah, please. Kanish, we have both priorities. We have to be growth with the profitable only. We will not do the growth for only revenue top-ups, that one. Yeah.
Okay, sir. Thank you. Thank you so much.
Thank you.
Thank you. The next question is from the line of Ravi Kumar Naredi from Naredi Investments. Please go ahead.
Thank you to give me this opportunity, sir.
Yeah.
Our competitor, one number, [inaudible] since it is Delhivery, how they damage our earning service last three years by incurring losses. What you expect next one year?
We don't want to comment on a particular competition, but you've seen their results also. Every competition has their own space and own field, but we are very clear on our sense. We will keep the revenue growth with the profitability only. This market is very big because our ultimate focus. Because we were in a slightly subdued revenue growth in the last five, six quarters because our focus and our dependence was on only one particular segment, only Surface Express. That was the biggest one. But now we-
Right.
faced this thing, and then we started the newer services also, and then you've seen the results in this quarter. Every other services has been increased phenomenally, very well. It means it's not that we will be less focusing on our Surface Express. This is the biggest one. We will keep growing simultaneously, but these newer services are slightly higher, and obviously, Surface Express will be in the more than double-digit growth in time to come.
Okay.
We're not seeing any competition can harm, or particularly can we get the business on lower prices and all. This is not the case, actually.
Okay.
Because in this industry, people are not behind the rates; rather, they want good services.
Because I am a shareholder since last six years and went to see your daily sorting center too, but the results are not up to mark. But you are doing hard work, that is the thing. Sir, Air Express, under you, say growth comes 24%. Earlier, say before four years, you were not sure for air cargo due to airport and airline handling problems, but now you are working, saying different story. Is this so?
Chander sir?
Can you repeat the question, please?
Sir, Air Express grew 24%. Earlier, say before four years, you were not sure for air cargo due to airport and airline handling problems, but now you are working, saying different story. Is this so?
Well, you have to also see that the business environment evolves. It changes. It cannot be static. If the air cargo business was slow before COVID, after COVID, it took off, and it is starting to now slow down again. But we have enough now base. We have developed a very strong base, where even with the lower volume growth, we will still be able to show growth.
I think it is all fundamental to how the company can change itself from the environment it is doing business in at the moment. I don't think that-
Right
Yeah, we are affected. We have to go as per how the market changes.
Right. What is your commentary for financial year 2027?
Mukti?
Yeah. 2027, so we are looking for 15% + kind of volume growth. With the 2% price hike, so 17%-18% kind of revenue growth we are looking for. Accordingly, profit margin, like PAT level, we will be increased in the range of 20% +. Because we are in a phase of expanding our team and creating separate capabilities for each services, like for Rail Express, for C2C Express, for Air Express, and International Air Express. So we are creating that one. We are refocusing back to on B2C segments also. Again, not like targeting big giants company, but again, small B2C players for the delivery of. Also, we also focusing on D2C, which is also increasing in this market. So we are looking for 15% growth in FY 2027.
Okay. Thank you.
Thank you. The next question is from the line of Dhruvin from SKP Securities. Please go ahead.
Hello, sir. I just have three, four very small questions to ask. First, from a product mix point of view, how do we expect our product mix to be in the next two years? If you have to give me a breakup between Surface Express, your International Air Express, Domestic Air Express, and E-commerce Express, how would you split your revenues in terms of percentages?
Yeah. Overall, like in this quarter, and I think FY 2026 end, nothing will be changed much. So we will be finishing around 18.5% - 19% in other services, and 81% is Surface Express. And of that, in this 19% chunk, we including Rail Express, Air Express, Domestic Air Express and International Air Express, C2C Express, and E-commerce Express part. So this is the part of that. And because these are again, few are the very small and we just launched them two, three years back. So biggest chunk is C2C Express, and then followed by Air Express, and then Rail Express, and then E-commerce Express.
C2C and this E-commerce as a percentage is how big a chunk?
It is very low. Again, 2%-2.5%.
Can you say like the next-
Earlier it was around 4.5%, then we reduced the chunk from the, again, big guys and all. We reduced, shrink to 2.5%, and now we will-
Is it the same as International Air Express? International Air is also around that range?
Yeah. It is also around 2%. Yeah.
All right. Okay. Second question, in terms of volume and realization per ton, what would be your guidance for 2027 and 2028 going forward?
This year, we are target to increase the yield by at least 100 basis points, 1% basically. Next year we are targeting 2%. Again, next year also 2%. By FY 2028, we will be in a situation to increase my realization by 5%. That directly add to our profits.
Okay. Last couple of questions. What was the volume growth in this particular quarter?
In this quarter,
Sorry, volume. Just volume numbers in this quarter.
The volume number is 2,55,000 metric ton in this quarter we achieved.
Okay.
And in nine months total is around 7,37,000 metric ton.
Okay. Last question. Your 500 crore of CapEx plan, which was supposed to end, I think, till FY 2027, then in the last call, we decided that we will push it to FY 2028. So by FY 2028, can we assume that this 500 crore CapEx will be fully incurred? Or is there something new coming up or some postponement or something expected?
Rightly so. We will be keep like 2027, 400 crore and then additional 100 crore by 2028. So you rightly said, by 2028, we will be consumed this 500 crore fully.
Very good.
We are on that path.
All right. Thank you so much, sir. That is all from my side.
Thank you.
Thank you. The next question is from the line of Anurag from Equirus Securities. Please go ahead.
Yeah. Hi, good evening. Am I audible ?
Yes, Anurag. Go ahead.
Yeah, sir. Just capacity utilization details for the quarter would be great. Yeah.
Yeah. Capacity utilization in this quarter, we have around 83.25%, because we supposed to be higher, but somehow after Deepavali, there's been a dip in volumes and then again picking up in December and all. So that's why it's happening around 83.25%.
Okay. Thank you, sir.
Thank you. The next question is from the line of Koundinya from Jefferies. Please go ahead.
Yeah. Hi, it's Koundinya. Thanks for the opportunity, sir. Sir, just trying to understand what is the scenario like, how is the momentum on the ground in the fourth quarter? Can you put some color on how is Jan and Feb, what does outlook look like. You also spoke about potentially taking early price hikes. So what gives you that confidence to take price hikes now? If you can speak a little bit about that, please.
Chander, sir, you want to comment on that?
You can go ahead, Mukti.
Yeah. So basically, Koundinya, basically, this environment has improved a lot in the sense of freight movement, in the sense of volume growth for the express industry and you are seeing the other competition number also, everyone is increasing. Third thing is cost pressure is stabilized now, but again, labor cost still is in increasing trend because government also want to regularize that and want to be given a Social Security and all. So that is going on and is also very clear by applying labor laws implementation there. With that, and business environment now is a good news where tariff has also reduced from 25% to 18%, and this penalty tariff is also removed. I think overall business scenario and as you have seen, economy is also growing.
Special thing where government is also putting very high emphasis on SME customers because government knows SME is a key segment for the Indian logistics also and for the Indian growth also. Obviously, Indian economy growth also. That is why they are putting an extra fund to regrow that. They also want to be creating a different cluster for the manufacturing, for the different kind of different manufacturing. Overall, we also put into a new segment, like we signing the contract for the EV vehicle companies. We also signed the contract with the solar. We also signing contract with the electronics companies also. And we also focusing on as we expand on a new geographies for the other services. Overall environment, I see growth is also coming from the. This is a good thing we are coming from that tier 2, tier 3 cities.
People have the more income into hands to consumption for that. Overall scenario looks great and again, one segment which we really facing challenges was lifestyle and textile industry, which is, I think, they will be also be at the boost up with these kind of tariff has removed from that. I think hopefully that industry will be start to doing well. Scenario like January 1 it was also getting good. PMI is also, as you have seen, improving. We are saying we will be also sync with that and certainly all the segment I am saying, verticals. Like moving different segment is also new companies coming up, existing companies also producing more and all. Hopefully, environment is very positive and interest rate is also very low as you have seen. I think inflation is also low. Customer is also intend to give slight hike to prices.
That environment has also built up. Now we are building our capabilities and surely we will achieve what we are promising for the quarter four and then subsequently and go on. Yeah.
Sir, where do you think you will. You did speak about 15% target for FY 2027. In FY 2026, where do you think that growth will end? Because after two quarters of weakness this quarter, you came back now finally at 5% growth, which is a decent number. So where do you think you will end the year at?
I think next quarter again, we will do single high digit growth or might be achieve-
Sorry, sir, I lost you there. Hello.
Management line has been dropped. Please press to connect to the management.
Sure.
We have connected with the management line.
There was some technical glitch and this line has been disconnected. Now we are back.
No worries. You were speaking about the growth momentum, and I was asking about where you can potentially earn a 26%.
I just mentioned on quarters, we will finish high single digit or might achieve double-digit growth in this quarter.
Oh, nice. Understood. Secondly, I see that your employee costs a bit have gone up. While you usually are very prudent on cost, this time it appears the costs have gone up. You did speak about adding some sales force and all. Maybe can you speak a little bit more, give more granularity on what is the kind of addition that you saw on the sales side, and what is the expected revenue growth or something? What are your plans out there? If you can speak a bit more on that, please.
Basically, yeah. Good question. Basically, this cost also included the labor code impact also, which is around INR 60 lakh, which is included here. Though we were prepared a long time back, where we were tuning everything. This time, the gratuity impact was there, and then we have taken into consideration. That's why it looks inflated there.
Sir, INR 60 lakh of past pay. Sorry for interrupting you, sir. INR 60 lakh is of past pay, or is it like a recurring thing that you included here?
No, it's a past impact. Overall impact, a one-time impact is there.
Okay, understood, sir.
The sales team, we're creating a sales for each different product separately, and that's why we are hiring the people, and that's why Mr. Chander also mentioned. We're creating a culture adoption also because we are hiring people from the outside world and then inculcating our culture with them. So we're giving high skill training and high culture training into company. So we will build up. We also planning to have at least to increase the number from 300 to 500 by March end. So this is our planning to build up the teams.
Oh, okay.
Yeah.
Understood, sir. Sir, lastly, I think there was an announcement that you are creating new related party policy. Unfortunately, that link is not working. Can you help us understand what is it about?
Sorry?
In the press release along with the results, there was an approval for new related party policy. There was some link given, but that link is not working. If you can help us understand what is the new policy about related party transactions.
It is in a recurring nature, actually. There is nothing new on that. Government is, SEBI is time to time defining the new rules and there is no significant change happened there.
We will give that link. I do not know where it is missing. There is nothing new change on that. They are changing over the period a few things, but nothing new has been changed. Just some definition has been changed. Some things happened on that, but nothing much on that.
Sure.
I will recheck that link, and then revert back on that, please.
Sure, sir. Thank you very much. Looking forward to positive growth momentum from you.
Thank you.
Thank you. The next question is from the line of Ashwin Reddy from Samatva Investments. Please go ahead.
Yeah. Hi. Good evening. Thanks for the opportunity. Firstly, could you let us know when was the last time that a price hike was taken?
Sorry, last?
The last time that we had raised prices. Because right now you talked about the price increase, which you plan to do. When was the last time that we had taken a price increase?
Yeah. Price increase actually is very dynamic. I think we had taken that price hike two years back in FY 2023, and then intentionally not taken because environment was not conducive for that. In this year, everyone has talked about to be price passing on basically because toll tax has increased, labor cost has increased. Price inflation is there for the overall industry. We also want to pass on. But yes, last time we had taken in 2023.
Got it. You talked about the retail sector not being strong yet. What percentage of our revenue comes from this sector now?
It's around 41%. We keep continuing like in the 50%, 51%.
What I meant is not the SME versus the institutional. What I meant is in the end user industries, the client industries.
Okay.
I thought you mentioned the retail sector has not done so well for you. What percentage of the revenue is this sector for you?
For us, revenue from that segment is around 8.5% in overall basis.
What would be the top five sectors for you, and what is the combined contribution from the top five sectors for you?
The top five-
The top five. Yeah.
Top five is contributing 55% revenue to us, and these top five are auto, pharma, engineering, electronics and textile. These are the segments we are getting this revenue, 55% from these segments.
Got it. Thank you so much.
Thank you. The next question is from the line of Chandramouli Jagannathan , an individual investor. Please go ahead.
Hello, sir.
Hi.
I think your market cap is now only about INR 2,000 crores. When it was about INR 6,000 crores, you gave a buyback. The buyback tax of auto buyback, I am talking about.
Yeah.
The buyback tax was also kind of the recent budget become little attractive. Is there any plan that you can think of because the valuation is so attractive?
Yeah, you rightly said because, the government has changed some tax part again. I think these are investor-friendly now. So we can think over, we will internally discuss, and whenever is required, we will do that. As last time also, our promoter has not participated on that, and it was even on INR 18.50 per share was there. So this, you rightly said, is like conducive time. So we will think on, but right now there is no discussion going on. If we found better, because taxation was not investor-friendly, so that is why market has also declined for all buybacks and all. So we can think over, but right now there is no proposal for that.
Sir, you were saying about your capacity utilization is about 83%. What is the maximum that you can utilize, and will there be operating leverage when the capacity utilization crosses 85% and above?
Yeah. There is always a scope to improve. We can reach on 85%, 86% by don't disturbing or reducing service level with the customer. We can do 85%, 85.5%. But if beyond that, we want to excuse that or improve the utilization, then we have to somehow compromise on the services, which we can't do. I think ideal thing is 85% - 86%. But again, I am saying it is a very dynamic one, again. Supposing whenever we reach on a highest capacity utilization, then we will be against move to another truck, which is an higher capacity truck. Again, I mentioned on various calls where 16-ton truck can be moved to 25-ton truck then. Then again, we have the scope to improve the utilization level for that.
Ultimately, per unit cost is coming down, and that way, since long we're doing that, and we have very high flexibility because we completely outsource our fleets. We have a very high flexibility in our hands, and we can do that within even less than one month time. That way is highly dynamic, and we can do whenever is required for that purpose.
Okay. Sir, now you are doing an EBITDA of about 10%, 11%, but your peak EBITDA was about 16%. Will you go back to that in the mid to long term? Is there any possibility?
Yeah. We certainly trying to achieve that back to this normal number of 15% +, because again, why this EBITDA has been impacted, which is, again, one reason is revenue. Second one, because we building up the capabilities for the other services, so we have to spend the money on to creating the network, like for the Rail Express, for Air Express and all. And once we will be like, again, you've seen the numbers where we're getting the high revenue from these segments. Once we will get the utilization level of this network will be increased, then certainly we will improve our EBITDA very fast. In past, we also did the same way. In one year, I think in two year time, we improved 400 basis point in two year time. This will come again, and we're trying for that.
Now we again in a phase to build up the capabilities, and I think we will take a balance approach. We are not putting a high cost on a particular segment and then getting the losses and all. Rather, we are going in a very gradual manner where we are building up the capabilities also, and we maintain the profits also. This way, we will be certainly back to this margin territory back of 15% +. Sure.
Okay. Approximately, how much time will it take, sir, two to three years? Also about the mid to long term perspective.
Yeah, I think we will be doing the next two, three years. Next year, we were targeting to be in the range of 13% +, and then subsequently, in each year, we can increase 100 basis points very easily. Again, I think by 2028 or 2029, we will achieve 15% +.
Okay. Sorry if I can squeeze one more. That means you mean to say that you are in the consolidation period where some of the new things are yet to produce results. Am I right?
Sorry, can you come hear me again?
No, I am saying you are in a consolidation phase where you have invested some of the money in the last two, three years. Those things are yet to give you a fruit. Right?
Sorry, I cannot get you, what you are saying.
No, I am saying whatever that you have invested in the last two years, maybe two, three years-
Yeah
those are the other new segments are yet to give you a result. So you are now what-
Yeah. You rightly said, because these are again a very inception phase. So we trying hard to be building up the capabilities and to get the revenues on that. So we're getting good traction in all the new services and obviously in Surface Express segment, again, our wide segment. So we getting new verticals business. We enhancing our wallet share with the existing customers. So we're putting all our efforts wherever we can get the revenue, but with the profit margins, obviously. So we'll do that, yeah.
Okay. Thank you, sir. No problem. Thank you.
Thank you. Ladies and gentlemen, as that was the last question for the day, I would now hand the conference over to Mr. Harshal Shah from PhillipCapital. Thank you, and over to you, sir.
On the behalf of PhillipCapital, we thank the management of TCI Express for giving us an opportunity to host the client, taking out time to connect with the investors. Thank you all for being on the call.
Thank you.
Thank you. On behalf of PhillipCapital (India) Pvt Ltd , that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.
Thank you.