MOSL: THE CORNER OFFICE (TRANSPORT CORPORATION OF INDIA) — Healthy volume growth led by restocking post GST-TCI key beneficiary of shift of trade from unorganized to organized

​THE CORNER OFFICE (Transport Corporation of India) — Healthy volume growth led by restocking post GST; TCI key beneficiary of shift of trade from unorganized to organized

Mr Vineet Agarwal — Managing Director

Mr Vineet Agarwal has been the Managing Director of Transport Corporation of India (TCI) since July 2011. He has been Executive Director since April 1, 2005. He has been instrumental in successfully positioning TCI as the market leader, more particularly, as a total logistics solutions provider offering customized solutions. Mr Agarwal holds a BSc degree in Economics and Industrial Management from the Carnegie Mellon University, USA.

• TCI has raised prices in the freight division and the supply chain division to pass on the impact of higher diesel prices.
• Volume growth in 2QFY18 was healthy, led by restocking by industries post GST implementation and festive demand.
• Implementation of e-waybills in March 2018 will determine the efficiency levels for road operators.
• Our view: While the industry is seeking clarity over GST implementation and efficiency gains from reorganization of warehouses, the real shift of business from unorganized to organized would happen post the implementation of e-waybills in March 2018.
• Prices increased to adjust for cost push
• Road freight operators including TCI have increased prices in 2QFY18 to pass on the impact of higher diesel prices. While road freight rates have not increased in tandem with the increase in diesel prices until now, any sharp increases in crude prices would result in sharper increase in road freight rates in the medium term. The coefficient of increase in road tariff to increase in diesel price was 0.4-0.5x in the last few months. This is likely to increase if crude prices firm up further.