Gati Ltd “Delivering On Time, Every Time”

Gati Ltd is a pioneer and leader in the Express Distribution and Supply Chain Solutions in India. The company has launched many path-breaking initiatives in the logistics segment. The business of the company is to move the cargo from one place to another using multimodal transport models, that is, Road, Rail, Air & Sea. They also offer specialized logistics services.

Being a market leader in India, Gati has a strong market presence in the Asia Pacific region and SAARC countries. Today, Gati has offices in China, Singapore, Hong Kong, Thailand, Nepal and plans to foray into other markets. Gati has over 3100 business partners across India and operates a fleet of more than 5000 vehicles.

Key Business Verticals

Express Distribution – The Express distribution and supply chain management business of the group is managed by Gati-Kintetsu Express Private Limited (Gati-KWE) a joint venture company between Gati Ltd and Kintetsu World Express -Japan’s leading logistics provider. Gati-KWE’s multimodal transportation service, unmatched reach, wide network, well-built infrastructure and strong technology ensures that every customer gets an integrated, seamless and cost effective solution right from planning, transportation, routing to delivery.

Gati e-Commerce – e-Commerce logistics services are the fastest growing business vertical for Gati

Gati Kausar – Gati’s cold-chain subsidiary, Gati Kausar, provides cold-chain solutions. Gati Kausar is a prominent player in the fast emerging Indian cold chain industry. The strength of the company lies in its state-of-the-art temperature controlled, integrated transport and storage facilities for agricultural produce, processed food and other temperature sensitive products.

Supply Chain Solution – Gati’s supply chain solution offers an integrated supply chain service to businesses across industry verticals. The company is equipped to handle customized as well as complex end to end integrated logistics solutions. Gati is in a unique position to partner with clients to identify cost Benet opportunities that drive value into their business and achieves this by driving synergy from its varied business units.

Result Analysis

Quarterly Consolidated

Net Sales during Q4FY16 stood at 425 crores vs. 414 in Q4FY15 growing 2.65%
Total Income From Operations stood at 428 crores in Q4FY16 vs 416 crores in Q4FY15 growing 2.88%
Operating Profit was at 28 crores in Q4FY16 vs 25 crores in Q4FY15 growing 12%
PAT for Q4FY16 was recorded at 15.54 crores vs 11.34 crores in Q4FY15 growing 37%

Annual Consolidated

Net Sales during FY16 stood at 1657 crores vs 1638 in FY15 growing by 1.15%
Total Income From Operations stood at 1667 crores in FY16 vs 1648 crores in FY15 growing by 1.15%
Operating Profit was at 93 crores in FY16 vs 106 crores in FY15 falling by 12%
PAT for FY16 was recorded at 49.23 crores vs 56.56 crores in FY15 falling by 13%
EPS stood at 4.21 vs 4.72

The Gati share price is trading at 152 with a P/E of 36.04. The stock has a market cap of 1329 crores. The 52 week high / low for the stock is 206.45 / 94.50 respectively. The company has not shown exceptional growth on a QoQ and YoY and we do not recommend fresh buy in the stock. Every rise should be looked as an opportunity to exit the stock.