Gati posts disappointed Q2FY16 result

Gati declared its Q2FY16 results. The company's consolidated revenue declined by 1.68 per cent to Rs 405 crore in Q2FY16 as compared to same period in the previous financial year. Its total expenditure decreased by 0.17 per cent to 375.69 crore in Q2FY16 on yearly basis. Gati's total expenditure declined predominantly because of 15.98 per cent reduction in cost of sales and 0.11 per cent reduction in operating expenses during the quarter. However, there was 15.81 per cent increment in employee expenses during Q2FY16 on yearly basis.

Gati's EBITDA decreased by 17.63 per cent to Rs 29.25 crore in Q2FY16 as compared to same period in previous fiscal year. The company's EBITDA margin contracted by 140 basis points to 7.22 per cent in Q2FY16 on yearly basis. Its EBIT also declined by 30.17 per cent to Rs 19.49 crore in Q2FY16 on yearly basis because the depreciation expense increased by 28.42 per cent to Rs 9.76 crore during the quarter. Gati witnessed a 11.51 per cent increment in interest expense to Rs 11.14 crore and 9.15 per cent reduction in other income to Rs 2.78 crore in Q2FY16 on yearly basis. The company's PBT reduced by 38.24 per cent to Rs 11.13 crore in Q2FY16 on yearly basis. It posted Rs 5.79 crore net profit with reduction of 16.45 per cent during Q2FY16 as compared to same period in previous financial year.

Considering the segment wise revenue Gati earned about 86.53 per cent from Express Distribution and Supply Chain segment, a 11.49 per cent from Fuel Station segment and the remaining 1.98 per cent from others segment in Q2FY16.

Gati's shareholding pattern indicates that FII holdings expanded by 114 basis points to 9.34 per cent while DII holdings contracted by 4 basis points to 0.26 per cent in September 2015. The share price of the company declined by 6.45 per cent on BSE in early trades and is trading at Rs 153.35 on intraday basis.

Gati has business of express distribution and supply chain solutions. The company's supply chain solution offers an integrated supply chain service to businesses across industry verticals. It offers warehousing, international freight forwarding, express distribution services, supply chain solutions, cold chain transportation solutions, custom clearance and e-commerce solutions. Gati serves in healthcare, engineering, automotive and consumer durable industry. The company operates a fleet of approximately 5000 vehicles on road and over 3100 business partners across India. It delivers 2.6 lakh packages every day across 672 of 674 districts in India. The company is a market leader in India and has strong market presence in the Asia Pacific region and SAARC countries with offices in India, Singapore, China, Nepal and Thailand.