Management

• Ashokkumar Haridas Lal (Chairman and Managing Director)
• Jitendra Haridas Lal (Joint Managing Director)
• Thomaskutty Varghese (Independent Director)
• Vipulchandra Sureshchandra Acharya (Independent Director)
• Sheelaben Mansukhlal Dattani (Independent Director)
• Suresh Amritlal Joshi (Independent Director)
• Harshida Jayesh Bhanushali (Chief Financial Officer)

Use of Proceeds

The total issue size is Rs. 410.71 cr, which comprises entirely of fresh issue of Rs 410.71 cr. The company intends to utilize a portion of the net proceeds towards the acquisition of dry bulk carriers in the Supramax category in the secondary market (Rs 251.18 cr), pre-payment/repayment, in part or full, of certain outstanding borrowings availed by the company (Rs 23 cr), and the rest for general corporate purposes

Competitive Strengths

Prominent player in the integrated shipping and logistics service provider in India The business provides integrated shipping and logistics solutions for dry bulk cargo at various ports and jetties in India and Sri Lanka. As of March 31, 2025, operations were supported by a fleet of more than 80 vessels, including barges, mini bulk carriers, tug boats, and floating cranes, along with over 370 earthmoving equipment such as excavators, pay loaders, tippers, trailers, and tankers. With a legacy of over three decades, it has gained strong experience in cargo handling, fleet chartering, transportation, equipment rentals, and other port services, making it a prominent service provider for all-weather and seasonal ports.

Brand, Integrated Solutions, and Customer Base Over the years, a trusted brand has been built through integrated services, efficient cargo handling, and on-time delivery. As of March 31, 2025, eight of the top ten customers had relationships lasting over five years. Services include lightering, stevedoring, port operations, transportation of dry bulk cargo, and equipment rentals. The business caters to industries such as oil and gas, energy, FMCG, coal, and metals. In Fiscal 2025, 106 customers were served, compared to 102 in 2024 and 96 in 2023. A majority of revenue consistently came from existing customers, highlighting a strong base and long-term client retention.

Long-term Institutional Customer Relationships The business-to-business model has enabled strong customer relationships across multiple industry verticals. For Fiscal 2025, 2024, and 2023, approximately 92.21%, 93.87%, and 96.59% of revenue came from existing customers, with eight of the top ten customers retaining ties for over five years. Long-term relationships enhance economies of scale, strengthen purchasing power, and reduce operating costs. The operational team works closely with clients to provide services such as loading, unloading, transportation, fleet chartering, and port management. These long-standing partnerships ensure consistent revenue streams, efficient operations, and the ability to adapt to client-specific logistics requirements.

Established Cargo Handling Operations for Dry Bulk Cargo Cargo handling remains the largest business segment and includes Ship-to-Ship lightering, stevedoring, and cargo management services. Operations extend across both major and non-major ports in India and Sri Lanka, with a primary focus on non-major ports that face tidal variations and draft restrictions. The company handles a diverse mix of dry bulk cargo such as coal, clinker, salt, iron ore, pet coke, sulphur, and limestone. Cargo volumes reached 15.71 MMT in Fiscal 2025, compared with 13.78 MMT in 2024 and 13.87 MMT in 2023. Efficiency is further improved by managing dispatch earnings and minimizing demurrage costs.

Operational Capabilities, Financial Performance, and Experienced Promoters The fleet includes self-propelled barges, mini bulk carriers, motor tugs, and floating cranes, supported by logistics assets like excavators, pay loaders, trailers, and tankers. As of March 2025, 94 employees were dedicated to repair and maintenance. Financially, EBITDA margins improved from 22.82% in 2023 to 33.03% in 2025, while PAT margins rose from 14.38% to 23.24% in the same period, reflecting cost optimization and strong pricing. The debt-to-equity ratio was 0.75 in 2025, with net debt of Rs 1,503.57 million. Founded in 1995 by promoters Ashokkumar Haridas Lal and Jitendra Haridas Lal, the business has evolved into a leading integrated logistics provider, guided by their six decades of combined experience.

Key Risks & Concerns

• In Fiscal 2025, 2024, and 2023, 20.86%, 15.20%, and 16.83% of revenue from operations was derived from the single largest customer, amounting to Rs 1,267.51 million, Rs 1,111.23 million, and Rs 1,391.71 million, respectively. Any reduction in business from this customer or the inability to maintain a close relationship could negatively impact revenue and have an adverse effect on overall business performance, cash flows, financial condition, and operational results. Heavy reliance on one customer exposes the business to concentration risks that could significantly influence financial stability.
• A substantial portion of revenue also comes from the top 10 customers, who contributed 64.12% in Fiscal 2025, 68.79% in Fiscal 2024, and 75.87% in Fiscal 2023. The loss of any of these key customers, or even a reduction in the volume of purchases by them, could materially affect financial results, disrupt cash flows, and weaken the overall financial condition. High dependence on a limited customer base reduces diversification and increases vulnerability to changes in customer behavior or demand patterns.
• The business is closely tied to the performance of industries such as oil and gas, energy and power, and coal, which contributed 54.11%, 49.51%, and 46.15% of revenue in Fiscal 2025, 2024, and 2023, respectively. Any downturn, fluctuation, or reduced activity in these industries could lead to a loss of customers, a decline in cargo volumes, or downward pressure on service pricing. Since these industries are cyclical and influenced by external factors, changes in their performance directly affect the company’s operations and revenue growth potential.

Outlook and Valuation

The company has built a strong presence in the shipping and logistics sector with over three decades of experience and a fleet exceeding 80 vessels and 370 earthmoving machines. It operates at more than 20 ports in India and Sri Lanka, offering comprehensive services such as cargo handling, lighterage, stevedoring, and port-to-premise transportation. Revenue for Fiscal 2025 stood at Rs 6,076.13 million with healthy EBITDA and PAT margins. A diversified customer base across oil and gas, power, FMCG, coal, and metals ensures consistent demand, while growth in Indian port cargo handling at a projected 10.80% CAGR strengthens long-term business opportunities.

Despite this growth, the business faces significant risks that could impact revenues and margins. Heavy reliance on top customers exposes it to concentration risk, as the loss or reduced business from major clients can hurt cash flows and profitability. The company enjoys robust B2B client relationships, with more than 92% of its revenues being recurring, which guarantees visibility and stability in earnings. The company has provided remarkable returns, achieving an ROE of 42.91% and ROCE of 28.09% in FY25, bolstered by consistently strong cash flow generation. We believe its growth in the coming years supported by the planned acquisition of dry bulk carriers in the Supramax category, which is anticipated to enhance capacity, promote operational integration, and position the company to take advantage of the expected recovery in cargo volumes, presenting a compelling long-term investment opportunity. The company is valued at a P/E multiple of 28.5x for FY25, based on the upper price band. We give a Subscribe rating to the issue for the long term.