Dear ,

Membership Exclusive: Why we like Western Carriers (India) Ltd?

We have recently added Western Carriers (India) Ltd to our Screener list.

Recommended Buy price: 124. Fair Price: 200.

We see the stock at 350-500 in next 2-3 years.

Pros:

1. Decent Sales Growth: 10-15% in last 3-5 years.
2. Strong Profit Growth: 22-30% in last 3-5 years.
3. Low Price to Book (P/B): 1.37
4. Good ROE: 22.4%
5. Company likely to pay off debt with funds raised from IPO. This will increase profits by 10-20%.

We recommend to continue adding the stock on dip for a fair price of 200.

About the Company from Screener Website:

Incorporated in March 2011, Western Carriers (India) Limited is a Multi-modal, rail-focused, 4PL asset-light logistics company.

Key Points

Business Service

- 3PL/4PL Services

- Courier Services

- Air Freight

- Water Freight

- Warehousing

- Project Logistics

- Road/Rail Transport

Their value-added services span the entire supply chain, from production and packaging to export, arrival, customs clearance, and multimodal transport, ensuring efficient and customized logistics solutions for clients.

Market Share: The company holds a 6% market share in domestic volumes and a 2% market share in EXIM (export-import) volumes.

Business Model: The company operates on an asset-light business model, offering multi-modal logistics solutions across road, rail, ocean/coastal/river, and air. They only own assets specifically designed to meet unique customer needs that third-party providers cannot fulfill. As of Mar-24, company has 471 Heavy CV’s,15 Lights CV’s and 590 shipping containers. 

Volume - FY24 Company has handled volumes of ~2,12,500 TUEs, with EXIM volumes handled at 1,51,637 TUEs and domestic volumes handled at 60863 TUEs.

Geographical Presence: As of September 2024, company operates 16 leased warehouses across 12 states in India, covering 714,171.28 square feet (93% leased). Additionally, they manage over 55 major rake handling points at various public ports throughout India.

User Industries: Metal (53.3% contribution), fast moving consumer goods (19.46%), pharmaceuticals and chemicals (7.04%), engineering, oil and gas (4.76%) and retail (15.48%).

Clients: Tata Steel, Hindalco Ltd, BALCO, HUL, Coca cola India, Tata Consumer, Cipla Ltd, GHCL ltd, etc. and has served over 1,100 clients.

Other services[8] The company offers chartering services to overseas destinations, stevedoring at Indian ports, and coastal cargo movement within India. Specializing in combining rail and road transport through an asset-light model, the company manages the supply chain for increased imports, exports, and production levels for a leading metals and resource group.

High Client Retention Rate

In FY23, 80% of its revenue came from customers who had been transacting for over three years, with a 100% retention rate of its top 10 customers. It has decades-long relationships with 7 of its top 10 customers, who contributed approximately 57.21% of FY23 revenue.

Employee Count: Co. has 1,427 employees in various departments.

IPO Details: Co. raised 492 Crs through the IPO and got listed on Sep, 24, 2024.

The Fresh issue will be utilized for:

A) Repayment of Borrowings

B) Capital expenditure includes the purchase of 40-foot specialized containers, 20-foot standard shipping containers, and reach stackers.

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We have restructured our pricing to yearly Rs. 5000/-

We are maintaining strong CAGR of above 36% for Screener stocks, SIP10Kto16Cr portfolio and even our Short and Sweet stocks.

We are closing our Lifetime membership deal of Rs. 12,000/- one time fee in 2024. Lifetime members will remain Lifetime members.

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Best regards,

Vinoth Kanna

Admin, Gale.in