Vakrangee in strategic tie up with IOCL for Uttar Pradesh

India's largest network of last-mile retail points of sale, Vakrangee on Tuesday informed stock exchanges about their tie-up with Indian Oil Corporation Limited (IOC) for setting up Vakrangee Kendra at its retail outlets (distribution network). This is the second tie-up of Vakrangee with IOCL this month. A day before this announcement Vakrangee informed about its tie-up with IOCL for Rajasthan.

Vakrangee is the unique technology driven company focused on building network of last-mile retail touch points to deliver real-time banking, insurance, e-governance, ecommerce and ATM services to the unserved rural, semi-urban and urban markets. These retail touch points are called as “Vakrangee Kendras” which act as the “One-stop shop” for availing various services and products. In this particular quarter, exceeding the estimated targets the total number of Vakrangee Kendra Outlets increased to 18,067 outlets.

IOCL is India's largest commercial enterprise, with a sales turnover of Rs 4,50,756 crore (USD 73.7 billion) and profits of Rs. 5,273 crore for the year 2014-15.

Currently, the Vakrangee Kendra shall be set up in 3575 IOC Retail outlets located across Uttar Pradesh. Citizens, in these areas shall now be able to visit nearest Vakrangee Kendra and enjoy services from all the 5 business units of Vakrangee, i.e. e-Commerce, e-Governance, Banking, Insurance, and ATM.

This tie up would drastically increase the customer touch points at the Vakrangee Kendra and ensure a boost in its core objective i.e. Financial Inclusion, Digital Inclusion, Social Inclusion, Employment Generation and Skill Development.

The services given at these outlets would be –

(i) All Government Services (G2C) offered through e-Mitra in Rajasthan, Aadhaar Enrollment & Updation.

(ii) Opening of Bank Account, Cash Withdrawal/Deposit & Fund Transfer.

(iii) Booking of Online products through e-Commerce giant Amazon, Mobile & DTH Recharge from all the telecom & DTH partners.

(iv) Availing Insurance Products offered by Tata AIG.

(v) Availability of the WLA ATMs.

On the financial front the consolidated net revenue from operations of Vakrangee reached Rs 819 crores in Q3FY16 compared to Rs 788 crores in Q2FY16, an increase of 4 per cent QoQ. The EBITDA stands at Rs 212 crores this quarter compared to Rs 204 crores in Q2FY16, an increase of 3.82 per cent QoQ. The EBITDA margin this quarter stands at 25.88 per cent compared to 25.92 per cent in Q2FY16. The raw material consumption decreased to 580 crores this quarter compared to Rs 714 crores in Q2FY16, a decrease of 18.80 per cent QoQ. The net profit stands at Rs 103 crores in Q3FY16 compared to Rs 89 crores in Q2FY16, an increase of 7 per cent QoQ. 

On valuation front the stock of company is trading at P/E of 32.48 compared to industry P/E of 20.41. The stock of company is trading at 218.60, an increase of 2.48 per cent from the previous close.