Gati’s stock has been buzzing in trade and is up 40 percent in the last one month and up 55 percent year-to-date (YTD). The company has seen revenues drop in the past three months owing to COVID-19, but is expecting recovery June onwards.
Rohan Mittal, CFO and Chief Transformation Officer of the company, said that the B2B market saw a dip in volumes in Q1, but is confident of a double-digit growth in FY22 on an overall basis.
“The B2B market saw a dip in volumes predominantly because of the lockdown in various parts of the country. Since our biggest exposure is to the B2B market and not to the B2C market, our volumes have also seen a dip in April and May,” he told CNBC-TV18.
“May especially has not been that great. We have seen almost about 40 percent drop in volumes as has the entire industry. B2C has grown, but for us B2C is less than 5 percent of our total business. So, there is only as much growth on consolidated basis that we are able to demonstrate because of that. But we are confident that we will able to demonstrate double-digit growth on an overall basis,” he explained.
He also said that the company has decided to exit the cold chain business as the business was in deep debt and was not able to make profit. “Our intention was to focus on a high Return on capital (ROC) asset like express and e-commerce business. Cold chain typically is a capital-intensive business which is yet to see high ROC numbers. Therefore, our intention was to exit that business,” he said.
The company has reduced debt by 60 percent, he said. “In our March numbers, the debt was close to about Rs 280 crore consolidated gross. As of today, we are at about Rs 180 crore of consolidated gross debt,” he said.
He also said that the company has no intent to merge with Allcargo.
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