Thank you. Good morning and very warm welcome to everyone.

On behalf of PhillipCapital, I am pleased to welcome you all on the earnings call of TVS Supply Chain Solutions Limited. We are happy to have management with us here today for question-and-answer session with the investment community.

The management is represented by Mr. Ravi Viswanathan, Managing Director; Mr.

Vikas Chadha, Global Chief Executive Officer; and Mr. R.

Vaidhyanathan, Global Chief Financial Officer. We will begin call with the opening comments from the management followed by interactive question-and-answer session.

With this, I hand over call to the management for opening comments. Over to you, sir.

Hi, this is Karthik here, Head IR. Thank you, Vikram.

Good morning, and welcome all of you to TVS Supply Chain Solutions earnings call for the quarter and year ended March 31, 2026. I hope everyone had a chance to look at the financial results, which were posted on the company's website on the stock exchange yesterday.

We have with us today Mr. Ravi Viswanathan, Managing Director; Mr.

Vikas Chadha, Global CEO and MD Designate; and Mr. R.

Vaidhyanathan, Global CFO. We commence the call now with opening remarks from our management along with the business performance update.

It will be followed by an open forum for question and answers. Before we begin, a customary remark.

I would like to point out that some of the statements made during this call may be forward-looking in nature and must be reviewed in conjunction with the risks that the company faces. A disclaimer to this effect has been included in the investor presentation.

I request and hand over to Mr. Ravi Viswanathan, Managing Director of the company, to make the opening remarks.

Over to you, Ravi.

Thank you, Karthik, and good morning to all of you. Firstly, let me welcome all of you once again to our earnings call to discuss the performance for the fourth quarter and year ended March 31, 2026.

We have had a spectacular finish to the year, and I am excited to share with you the highlights of our performance. I am joined today by my colleague Vaidhy, our Global CFO, who will take you through the analysis of our numbers, and Vikas Chadha, our Global CEO and MD Designate, who will walk you through the business updates.

We look forward to interacting with you as part of the Q&A session. For the benefit of those participants who might be joining the analyst call for the first time, please note that TVS Supply Chain Solutions is a tech-led and asset-light supply chain solution provider.

We have two main business segments, namely the Integrated Supply Chain Solutions, or ISCS, and Global Forwarding Solutions, or GFS. We operate across four continents: Asia, Europe, North America, and Oceania, where we offer bespoke and tailor-made solutions in the 3PL space and also offer 4PL services in select markets.

For more details about the company, you may please refer to our website, www.tvsscs.com/investor-relations. Coming to the performance of our company, FY26 marked a strong turnaround year for us.

We crossed 11,000 crores in revenue with a growth rate of 10.1%. We achieved an adjusted profit before tax of ₹99.3 crores, which is a significant improvement from ₹37.3 crores in FY25.

At the outset, I would like to thank our customers and vendor partners, employees, and other stakeholders without whom we would not have been able to achieve these milestones. The highlight of this year has been that our growth has been more diversified and broad-based across regions.

In the ISCS segment, revenue from operations grew by 9.6% over last year. Our performance in India has shown strong growth, and Europe has had a turnaround performance aided by new business wins and disciplined cost initiatives.

This helped in overall performance and improved the profitability. North America business helped improve the top line with a new large project that went live in the second half of last year.

Moving to the GFS segment, revenue grew by 11.4% over last year, aided by significant growth in India volumes. While global freight rates continue to remain under pressure, our cost initiatives and volume growth in India helped us minimize the impact of the geopolitical situations.

Now let me come to the quarterly performance. Our consolidated revenue grew to ₹3,032 crores, a growth of 21.3% year-on-year basis and 11.7% on a sequential basis.

This is the first time that the company has hit 3,000 crores in a quarter, and it bodes extremely well for us. I am pleased to share that we have delivered on our commitment that we made in the previous quarter on our quarter four growth, particularly in the ISCS segment, which showed a strong year-on-year growth of 17.5% and a sequential growth of 15.4%, reflecting new wins across all regions.

Regarding the GFS segment, in our freight forwarding business, we had previously indicated that while volume growth would continue, margins would remain under pressure. Accordingly, we witnessed strong volumes on a year-on-year basis, led by India ocean freight.

The segment has shown tremendous resilience and has grown by 34.8% on a year-on-year basis. It is important to call out that the GFS business continues to operate at structurally lower margins, and the global freight industry is currently facing a period of uncertainty, influenced heavily by war-induced trade disruptions across major trade routes.

On the profitability front, for quarter four FY26, the adjusted EBITDA was ₹222 crores compared to 161.4 crores, which reflected, on a year-on-year basis, a growth of 37.5%, a margin improvement of 80 bps to 7.3%. Sequentially, we delivered ₹199.3 crores at a growth rate of 11.4%.

For the full year, our adjusted EBITDA stood at ₹773 crores, up from 675.3 crores in FY25, reflecting a double-digit growth of 14.5%. Our new business wins accounted for 12.1% of FY25 revenues.

This, coupled with our cost initiatives such as Project One, have clearly yielded results, and we continue to pursue these. In the last quarter, we entered into a definitive agreement to acquire Swamy and Sons 3PL that strengthens our capabilities in the FMCG and consumption-led supply chain space in India and deepens our presence in key consumption markets.

The transaction was completed this month. This will be margin accretive to our India business in FY27.

We continue to be a tech-led company and early adopters of technology, and have integrated AI and robotics in many of our operations. We have also applied a patent for our Unified Logistics Platform, which has been accepted.

Let me now hand you over to Vaidhy, our Global CFO, who will take you through the financial highlights for the company.

Thank you, Ravi. Good morning all.

Thank you for joining us today. If I can call it a headline of our performance commentary, that one line would be: on a full-year basis, revenue grew double-digit by 10.1%, adjusted EBITDA grew double-digit by 14.5%, and adjusted PBT grew by 166%.

Few highlights before we get into the detailed financial performance. We delivered a strong performance in Q4, achieving 30.9 crores of adjusted PBT compared to 18 crores in Q4 FY25, and we also grew sequentially by 23%.

On a full-year basis, our reported PBT stands at 274.1 crores, including the inward gain of 177.2 crores in Q1. We also generated close to 243 crores of operating cash for the year, reflecting the improved profits as well as efficient working capital management across all the regions.

Now I will take you through the detailed highlights of our financial performance for Q4 and year ended 31st March, 2026. Our consolidated revenue for the quarter reached ₹3,032.2 crores versus 2,498.8 crores in Q4 FY25 and 2,715.8 crores in Q3 FY26, reflecting a year-on-year growth of 21.3% and a sequential growth of 11.7%.

Both the segments have contributed to this growth. The growth in India region came very strongly at 31.4% on a year-on-year basis, aided by strong new business wins as well as significant volume in our freight forwarding business.

From a segment perspective, ISCS segment delivered strong year-on-year growth with revenue at ₹2,283.4 crores in Q4 FY26 versus 1,943.4 crores in Q4 FY25 and 1,979.5 crores in Q3 FY26, continuing to show strong momentum, delivering double-digit growth on a year-on-year at 17.5% and 15.4% sequentially, supported by strong revenue from new business wins and improved profitability. GFS segment clocked a revenue in Q4 FY26 of 748.8 crores compared to 555.4 crores in Q4 FY25 and 736.3 crores in Q3 FY26, marking a 34.8% year-on-year growth, largely led by the growth in ocean freight volumes in India.

Freight rates continue to be under pressure, as Ravi mentioned earlier. For a full year, our consolidated revenue stood at ₹11,003 crores compared to 9,996 crores in the previous year at a growth rate of 10.1%.

This growth was led by ISCS segment revenue of ₹8,238.9 crores, reflecting a 9.6% growth compared to 7,514.9 crores in FY25. GFS segment reported revenue of ₹2,764.1 crores, reflecting a growth of 11.4% to 2,480 crores in the previous year, driven by strong volume growth in ocean freight in India as well as new customer wins.

Other income for Q4 FY26 stood at 10.5 crores, lower than 13.4 crores in Q4 FY25. On a full-year basis, other income was 37.8 crores compared to 33.2 crores in FY25.

The movement is primarily due to the interest income from bank deposits. Now moving to the cost structure.

Freight clearing, forwarding, and handling expenses increased from 632.8 crores in Q4 FY25 and 784.8 crores in Q3 FY26 to 813.3 crores in Q4 FY26, which is largely in line with the revenue growth in the GFS segment due to the volume growth in the ocean freight. On a full-year basis, freight costs moved from 2,816.2 crores to 3,005.7 crores in line with the business growth.

Material-related cost increased from 465.5 crores in Q4 FY25 and 470.5 crores in Q3 FY26 to 652.7 crores in Q4 FY26. Increase is primarily due to the new business wins in India and increase in volume in the North America and Europe markets.

On a full-year basis, the cost increased from 1,767.7 crores in FY26 to 2,049 in FY25—as compared to 2,049 in FY25. The movement in the material costs and other related costs are in line with the change in business mix in the ISCS segment.

On a year-on-year basis, employee cost increased from ₹610.1 crore in Q4 FY25 to 640.5 crores in Q4 FY26 due to cost inflation and in line with the revenue growth, partially offset by the cost takeout initiatives that we have taken across all the regions. On a sequential basis, it increased from 598.6 crores to 640.5 crores.

Full-year employee cost increased from ₹2,353.4 crores in FY25 to 2,502.4 crores in FY26, reflecting the impact of annual inflation and the employee cost for the new projects that we entered into during the year. Subcontracting cost increased from 360.7 crores in Q4 FY25 and ₹393.9 crores in Q3 FY26 to 406.9 crores in Q4 FY26.

This is in line with the revenue growth from new customers. On a full-year basis, subcontracting cost increased from ₹1,438.6 crores to 1,554.7 crores in FY26.

Other expense moved from 274 crores in Q4 FY25 to 269.8 crores in Q3 FY26 to 297.5 crores in Q4 FY26. On a full-year basis, it increased from 953.7 crores in FY25 to 1,122.1 crores in FY26.

The increase was primarily driven by higher rental charge due to increase in short-term lease rentals and higher repairs and maintenance in the warehouse in the ISCS segment. Depreciation of right-of-use assets and interest on lease liabilities under Ind AS 116 increased year-on-year, with depreciation increasing from 94.2 crores in Q4 FY25 and 106 crores in Q3 FY26 to 108 crores in Q4 FY26.

Interest cost on lease liabilities increased from 20.8 crores in Q4 FY25 and 23.2 crores in Q3 FY26 to 24.8 crores in Q4 FY26. The increase in the Ind AS 116 cost was due to the second site that went live in one of our key projects in North America market in Q4 FY26.

On a full-year basis, the depreciation of right-of-use assets has increased from 398.5 crores in FY25 to 403.4 crores in FY26, and the interest cost on lease liabilities has declined from 87.6 crores in FY25 to 82.9 crores in FY26. This is primarily due to the initiatives to optimize the lease commitments, transitioning selectively from long-term leases to medium- and short-term rental arrangements wherever operationally feasible.

On the profitability front, our adjusted EBITDA grew by 37.5% year-on-year, with the margins expanding by 80 bps to 7.3%. This growth was driven by strong performance exhibited by India and Europe region.

Sequentially as well, adjusted EBITDA grew by 11.4%, demonstrating the consistency of the underlying earnings trajectory. With respect to segment, ISCS has delivered strong performance in Q4 FY26, with adjusted EBITDA of 202—212.8 crores in Q4 FY26 at 9.3% margin, up from 164.7 crores at 8.5% margin in Q4 FY25 and 182.9 crores at 9.2% margin in Q3 FY26.

The significant margin improvement in ISCS is mainly on account of the recovery from the Europe business, with India continuing to deliver consistent growth and profitability. GFS delivered an improved performance in Q4 FY26, with adjusted EBITDA of 18.3 crores at 2.4% margin, up from 8.7 crores at 1.6% margin in Q4 FY25 and 17.3 crores at 2.3% margin in Q3 FY26.

The margin improvement reflects the volume growth in India and the result of the cost optimization initiatives that we had undertaken in this segment to partially offset the macroeconomic challenges that Ravi highlighted. The segment continues to face macroeconomic headwinds, reflected in the subdued freight rates.

We delivered an adjusted PBT of 30.9 crores in Q4 FY26 compared to ₹18 crores in Q4 last year. On a full-year basis, the adjusted PBT increased by 166% from 37.3 crores in FY25 to 99.3 crores in FY26, reflecting the results of the growth as well as the operating leverage.

Our reported PBT for the quarter stands at 25.7 crores after the exceptional cost of 5.2 crores relating to the impact of the new labor code, which is reported as exceptional items. As I mentioned earlier, our operating cash generation stands at 243 crores, reflecting the improved profitability and the working capital efficiency.

With this, I will request Vikas Chadha for the commercial updates. Over to you, Vikas.

Thank you, Vaidhy, for the analysis. A very good morning, good afternoon, good evening to all of you.

Before I touch upon the commercial updates, let me first introduce myself. I have 30-plus years of progressive leadership experience driving billion-dollar-plus P&L operations across diverse industries and geographies.

I'm absolutely delighted and thrilled to be part of the TVS Group, and I'm looking forward to creating a very healthy shareholder value during my tenure. I would also like to thank Ravi as he retires from TVS Supply Chain Solutions for all his valuable contribution and laying such a strong foundation for me.

Now, coming to our business development performance and pipeline strength, it has been phenomenal, and it reinforces our growth outlook. In Q4, we recorded new business wins, which is an all-time high in a quarter, of 523.7 crores, representing 21% of Q4 FY25 revenue.

For the full year, the new business totaled ₹1,206.7 crores, which is 12.1% of FY25 revenue, a clear sign of traction across key geographies. We are also seeing very strong momentum in the quality of clients that we are onboarding.

This year, we added nine new Fortune 500 customers, taking the total number of active Fortune 500 clients from 91 last year to 100, a significant milestone that speaks of the growing relevance of our offerings in the global marketplace. Our order pipeline remains robust at ₹6,100 crores, giving us a view of the road ahead for the coming quarters.

Across both our segments, ISCS and GFS, we saw wins from several key and marquee customers. On the ISCS side, we secured mandates from India and major international markets, including: a leading Indian electric vehicle manufacturer; top electrical equipment company in India; multinational provider of home appliances in India; leading Indian value retail chain player; North America-based manufacturer of lifting equipment; a global engineering and technology solution provider; leading Indian MNC in IT services space; global information technology major.

These wins reflect the diversity of our expanding customer portfolio, the strength in our tech-enabled execution, and the trust our customers continue to place in TVS Supply Chain Solutions, which acts as a testimonial of our delivery capabilities. Particularly India, continued to deliver exceptionally well on business development with multiple large strategic wins across automotive, consumer durable, and industrial verticals.

These wins will drive revenue growth in the quarters ahead, especially in the ISCS business, where our positioning continues to strengthen across production, aftermarket, and distribution-led supply chains. On the GFS side, we added several marquee customers, including: multinational material handling provider; a top global leader in sanitary and bath solutions; global fashion and apparel retailer; a leading Indian tire manufacturer; leading industrial automation and robotics company.

Thank you all for hearing this update, and with this, we open the floor for Q&A.

Good morning to the team. I have two questions.

The first question is how is TVS Supply Chain preparing to capture future opportunities in global logistics, warehousing, and supply chain technologies, while thoughtfully addressing challenges such as geopolitical disruptions, rising costs, and digital transformations?

Sorry to interrupt. You're not coming out very clear.

We're not able to hear you clearly. There's a lot of background...

Oh,

yes. Sorry.

Am I audible now?

Better now. Thanks, Sukrit.

Sorry about the delay. I just want to understand in your point of view, how is TVS Supply Chain preparing to capture future opportunities in global logistics, warehousing, and supply chain technologies, while thoughtfully addressing challenges such as geopolitical disruptions, rising cost, and digital transformations?

What strategic levers do you see most important for sustaining growth and maintaining the leadership in FY27? Just want to understand your point of view on this.

Thank you. Right.

Thank you, Sukrit. I think it's a great question.

I think we have always maintained that we are a tech-led supply chain organization. We continuously keep looking at how technology can differentiate in the marketplace.

An outstanding example is a recent engagement that we are involved in in North America, where we have engaged fairly sophisticated robotic technology coupled with digital platforms, which bring a significant difference from what the customer was used to with his incumbent supply chain provider. I think the key for us is our last name, which is TVS Supply Chain Solutions.

Our solutioning brings in a significant differentiator in terms of combining technology along with domain knowledge, and that's what is differentiating us in the marketplace. With respect to the geopolitical situation, I think it should give all of our investors a lot of confidence that this organization has been incredibly resilient in a year where there have been significant geopolitical challenges.

In spite of that, we have recorded growth which has been I would say unprecedented since we listed in the bourses. We continue to focus on the fundamental character of the company, which is to stay close to the customer, build deep relationships, consistently look at how we can cross-sell and add value, and bring a technology component to every aspect of our solutions.

That's really what is being the big driver for us in the Integrated Supply Chain Solutions space. You can see from the results that the ISCS growth has been broad-based across our geographies.

Whether it's in Europe, whether it is from the US, or in India, we've been able to get spectacular results. This is coming on the back of some very strong moves that we made over the last six to eight quarters, which we have been sharing in this platform.

We continue to be bullish about the ISCS segment. We believe that our differentiation through technology and our deep customer relationships will help us continue our growth momentum.

Vikas just told you about how we have expanded our portfolio from 91 Fortune 500 customers to a 100, and we continue to keep a very close tab on that. It is the quality and the depth of our customer relationship which will differentiate along with the technology which is infused in all of our solutions.

I hope that helps you, Sukrit. I'm happy to take additional questions now or at a later point in time.

Thank you. My second question to Mr.

Vaidya Mr. Vaidhyanathan is from a technical point of view, how is the company optimizing its capital structure to balance growth, investments in logistical infrastructure and technologies, while still maintaining the debt structure, especially given the capital-intensive nature of global supply chains?

Can you elaborate on the framework being used for cash flow forecasting, interest rate risk management, and working capital efficiency to ensure liquidity while still maintaining the profits? Thank you.

Sure, Sukrit. I think there's a lot to be covered.

Okay. From a capital allocation point of view, I think we have a very clear focus.

I think our priority is to allocate more capital for the ISCS business. As we always is, we are an asset-light business, and we don't invest in any fixed assets.

Most of our assets are only for some warehouse-related, and we always follow an asset-light model for investment. From a working capital point of view, we have an extremely strong cash management as well as working capital management, and we ensure that we have a very tight control on the working capital.

If you look at our overall net debt as of 31st March, it's hovering around 350, 370 crores. Except about 120 crores, which is long-term in nature for a specific project, bulk of our debts are all short-term working capital in nature.

I think that is how we manage our cash flow as well as the capital structure. Our ratings has been extremely strong, India AA ratings.

We take a very, very strategic point of view before we allocate any capital to any new business or new projects.

Thank you, and best wishes. Thank you.

Thank you.

Good morning, sir. Congrats on good set of numbers.

My first question is regarding our GFS business. Because of the disruptions in the geopolitical situation currently, are we facing any disruptions in our routes where we operate, so that is the rest of the world GFS?

Also if you can throw some light on the outlook of India GFS business going forward for FY27?

Okay. First is, are we in any of the trade lanes which are in the West Asian zones?

The answer is no. I think, look, this is a network business, Ankur, right?

It's really about something which is a hotspot in West Asia could impact any of our trade routes. We do see disruptions, especially in the smooth flow of traffic.

Having said that, the India business has had tremendous growth in this quarter. We remain bullish about the fact that we'll be able to continue on this momentum given the volumes.

We are not particularly worried about sea freight volumes at this point in time as we look outward. What could be very volatile is pricing.

Pricing pressures continue, and we need to keep a very close eye on the pricing in this segment. We continue to remain bullish about volumes from India.

On a broad base, I would expect GFS to deliver better than how we have delivered in FY26.

Okay. Understood.

My second question is regarding the ALA MOU that we had signed recently. Is there any update on that, and do we see any visibility coming in FY27?

Probably too early to say, Ankur, but we just recently signed, we are early days, but you will hear updates from us in the near future and how we plan to get further into that segment. We clearly have identified defense and aerospace as a great opportunity, and that's the reason why that MOU is very relevant.

We continue to work very closely with ALA, who are a very niche player in that segment and who are very keen to participate with us in this market and specific markets. We will give you an update as this evolves, but I would say we have made progress since the MOU, and hopefully we'll have more to share in the near future.

That's great. Finally, if you could just share the growth outlook for your ISCS business also within India as well as rest of the world.

That's Europe and USA.

Sure. Look, I think there are a lot of positives.

One is, this is the first time we have hit a 11,000 crore revenue, a 3,000-plus crore revenue in Q4. I think most important lead indicator that I will leave with you is the fact that we have new revenues coming from business development made in Q4, which is a record, and Vikas spoke about it.

524 crores is the revenue that we got from new business wins just in Q4, which represents more than 20% of our Q4 revenues. That's a very strong lead indicator and a very strong exit as we get out of FY26 into '27.

I would just say we have strong wins which will give us a sufficient tailwind into the first half of the year, and we have significant pipeline which are at various stages of conversion, and we remain very confident of a double-digit, maybe an early-teen kind of number for the whole year from an overall perspective, and ISCS would probably be a very strong contributor to that.

All right. Thank you.

That's all from my side.

Hello? Am I audible, sir?

Yes, ma'am. Please go ahead.

Yes. Thank you so much, sir, for this opportunity.

Again, my first question was on the GFS segment, sir. We've seen the Indian volumes rise drastically, sir, for this quarter.

What were some of the reasons for that, and how has Q1 been so far, sir?

I will probably not speculate on Q1 as yet, but let me just say Q4 is on the back of some significant business wins. I think Vikas spoke in his commentary about a lot of new wins that we had this quarter.

The volume growth is coming on the back of that, and we continue to get significant new wins in both ISCS and the GFS sector. I would say we're seeing both volume growth or what we call as encirclement or cross-selling within existing customers showing growth, but also new customer wins that are fueling the GFS volume growth.

We do expect this momentum to continue, right?

I remain very optimistic, Disha.

How should we look at the EBITDA margin, sir, for FY27? Because we've seen high traction from the ISCS segment as well.

How should we look at the EBITDA margin?

Disha, I will take this. Vaidhy here.

See, on the ISCS, I think right now we're about 9.3%, and we should be range-bound between 9.5% to 10% on the ISCS from a margin point of view. As Ravi said with all the large customer wins and also the operating leverage actions that we have taken, I think we will be somewhere between 9.5% to 10% on ISCS.

For the overall margin, sir, for FY27? See,

I think it all depends on, as Ravi said, on the GFS trajectory in terms of the freight rates and all that. I would say somewhere between, right now we are at 7%, should be around 7.3%, 7.4% on the adjusted EBITDA.

I think a lot depends on how the GFS trajectory moves.

Disha, I would just be cautious about GFS given the geopolitical situation. Like I said, we're bullish about the volumes, but we have to keep a very close eye on the rates.

It's been very volatile, and we'll keep you updated on this as we progress. We have a very clear understanding of how we will get better leverage on the ISCS business.

On the GFS, I will still be cautious because it is all about customer relationship, deep customer relationships. We will continue to focus on going deep with our relationships.

There is a dependency on pricing, which is volatile, and I will just leave it there because right now it will be speculation if I get deeper on that.

I hope that. Fair enough, sir.

Also, sir, we have a robust order pipeline. What sort of conversion are we looking at for FY27, and when do we see majority of orders flowing in?

Our typical conversion, like we have said in the past, has been around 22%. We look at that, hopefully we keep improving on that.

That's typically what our conversion ratios have been.

Okay. That is very helpful.

That's it from my side. Thank you, sir.

Thank you.

Hi, team. Congrats on this turnaround.

Couple of questions from my side. First one being on China-plus-one and the US firms which are trying to eye India, if you can take us through which are the sectors which these guys are actually looking at and which could probably be the strongest relocation candidates where you see momentum, or anything on the current pipeline if you'd like to share?

The China-plus-one, we do see a lot of early traction with our existing customers, but none which has got very deep. You did see a few examples of things that we did with some multinationals.

We had shared some of the new things that we're doing, especially with a large earthmoving equipment company. We see traction across the board.

There have been some early wins, but I would still keep looking at that space because capital allocated by those customers towards expansion in India is something which we need to keep a close tab on. Given the geopolitical environment, especially with the US buyers, I would still wait to see whether there's going to be acceleration on that front.

Is it possible to share that when we compete with these global 3PL players, what sort of operational capability that we portray that the competitors are still underestimating about TVS?

I don't want to talk about what the competitors underestimate about us. I think the key strength for us is that we have a very strong relationship with some of the large multinationals, and given that we have a presence in 100 of the top Fortune 500 customer base, it gives us a very strong currency to participate.

Second is, we have a very strong brand at TVS, and that legacy is something which helps tremendously. That, coupled with the fact that we have a very strong India presence and an India story, is really a big driver.

We are in the invitee list on almost every large MNCs foray into India, and that's the exciting part for us. India continues to be a very strategic region for us.

We'll continue to see how to continue this acceleration that we see. There are some very interesting sectors that we see momentum in.

One of them is the power sector. This is specifically with alternate power, and quite a few multinational companies' activities we are able to now participate.

Sir,

we did mention about these new businesses that are coming through and the new sectors which you just alluded in your previous comment as well, along with aerospace, defense, or maybe energy and renewables. What are these certifications that you think are critical bottleneck in India currently, and how sticky are these contracts or maybe how deeply embedded are they with TVS Supply?

Are you talking about existing contracts that we have?

Existing contract, as well as the one which might come maybe in the next 3 years or so.

The existing contracts, the stickiness is what you create. It's really about, I think I spoke about it in my opening commentary that we have very deep customer relationships and the flexibility that we have had in terms of engaging with the customer during different cycles of the business environment, especially the volatile environment that we have seen over the last couple of years.

If you take a look at our relationship and the customer's contract, the average length of our customer contract in India is about 4, 4.1 years, and that is five 5-plus years in North America and almost 7.5 years in Europe. That kind of shows the stickiness of the engagement that we have.

The average length of these relationships are fairly long, and it continues to grow on a period-by-period basis. That's something which I would talk about from an existing customer perspective.

You spoke about certification. Clearly, aerospace and defense is a certification space, and that creates significant both entry and exit hurdles.

Our MOU with ALA is really about leveraging on their global capabilities and the certification that they already have with many of the existing suppliers in this space, and that will give us a competitive advantage as we enter the segment.

On this aero supply chain services, what sort of lessons do we have from the UK defense logistics, which you think are transferable to India currently?

I think the key is for us to understand how defense organizations work, their processes, the ability for us to participate in large, complex, multi-year deals over the last few years gives us that depth. That's something which is a huge differentiator for TVS SCS because I don't think any other Indian player participates in those kind of engagements.

That experience is something which is a huge differentiator, and coupled with the kind of partnership we're trying to engage with a leading global supplier, that'll put us firmly on a leadership path to participate in some of these spaces in India and beyond.

Sir, on the guidance aspect, by FY29-30, do you think that I know top line is not an issue for us, but then with the sustainable EBITDA margin maybe like 12% or 13%, do you think that we can reach somewhere around 15,000 crore by '29-30?

I will leave that question to Vikas for the future, but clearly that is something which we have shared with you in the past, right? Look, for us, we keep talking about continuously expanding our EBITDA margins.

We have shared in the past that the benchmark EBITDA numbers are in the early teens, and that's our aspiration. We think in the medium term, we should get to about 10.5%, 11% in ISCS, and we hope that we can push the GFS margin, maybe this is not the year, but in the next 4 to 8 quarters, move it to closer to 5%, and hopefully settle at about 6%, 6.5%.

Sir, last one from my side. If we were to revisit TVS in maybe FY30, what metrics beyond the revenue would convince the management team that the strategy is actually truly worked?

First and foremost, I think we are focused on profitable growth. Profitability is something which is a very key driver.

Our trajectory has been good, and we want to continue on this trajectory. Profitable growth is number one.

Number two is continue to mine our existing customers, get deeper into our customer relationships, create larger portfolios, which means that we are doing significant cross-sell and up-sell. Hopefully, some of the newer segments that we are entering, for example, in India, the acquisition of Swamy and Sons gives us an entry into FMCG and the MOU on the aerospace and defense gives us an opportunity to expand our defense portfolio.

Overall, if I were to look at it 3 years hence, the verticals that we are today entering into, if we can drive similar margins and much higher growth rates in those segments clearly would mean success. Of course, deeper engagement with our customers, which we are very confident of because that's been the essence of the TVS Supply Chain Solutions story and evolution over the last three decades.

Sir. Thank you for answering my questions.

Thanks a lot.

Good morning, and congratulation on very strong numbers, sir. Just wanted your comment on if you look at segment-wise our profiles between India and Europe, I think it's pretty diversified between automotive, consumer, industrial, healthcare, and other segments.

US business is mostly dominated by only two segments. How is the growth outlook there, and then diversification possibility in US, particularly North America market?

I think for us, the US we do operate on a very strong account-centric plan, right? We have picked industrial and auto sector as the areas of focus, and that has been the biggest growth driver for us.

If you look at US over the last 5 years, we've been growing at about 28.3% CAGR, and we really think that the opportunity in the US is with large customers, we should be able to get a significant size of the pie. Previously, 5 years back, US was really a scattered map, but today we are getting deeper into fewer customers, and we want to grow each of these customers because those are the customers who typically can deliver $50, $60 million of annual revenue, and if we can create a portfolio of four or five such customers, that will give us a very, very strong foundation on which then we can expand the US market.

Our current focus remains on industrial vertical and the auto vertical. There are a lot of opportunities, but we are remaining very focused in mining large customers that we work with.

They're all Fortune 500 customers that we work with in the US, and we want to see how we can convert each of these customers into double-digit million, closer to $50 million of business over the next 3 to 4 years.

Got it. Apart from this industrial and auto, are there any backend challenges for us to add newer verticals, or it is not a focus area as of now?

I think it's really about what we want to focus on. I think we want to make sure that the management bandwidth is really focused on mining, deepening the relationship, and then saying if I have a product set, is it easy for me to just expand that product set and go into customers who have got similar requirements rather than looking at a larger canvas in which we can operate.

The US is a very large country, very, very large spend, but I would say, we need to get to a place where we have a strong foundation, very strong stories, and that's basis on which we will expand. We want to remain very focused on the kind of sectors we want to get into in the US.

Having said that, if there are opportunities for us to partner with some of our both tech and non-tech partners, we will keep evaluating it, but our focus is really on saying look at auto and industrial and adjacencies to that.

Understood. We have very strong new business wins this quarter.

Internally, do we have as a percentage of revenue to target as a new business win as internal target, and do we also look at the customer churn basically as a one of the indicator or any target internally, or it's more on a new business win only?

Customer churn is something which in this business, especially in the GFS side, you will find that that's a constant. More importantly for us, we have been typically at about 10%, 11% of the previous year revenue which is coming in as new business wins.

We want to get to a place where we constantly keep increasing that. For this year, we got that number to 12.1%.

So 12.1% of FY25 revenues is what is the new business wins for FY26. If we get to about 12% to 15%, I think we know that the engine is working very well, and that would give us the momentum required for us to meet our medium-term targets.

Okay. Just last question.

Integrated final mile, basically, you don't give separate number, but in terms of understanding, are we seeing improvement in there also materially, or it was integrated supply chain which has driven the profitability, just to get some idea about between two how things are going?

Let me just ask Vaidhy to answer that, but from our perspective, we have integrated that business, but you can probably dwell deeper into that. Yeah.

If you want to call it a subsegment.

Sure. Thanks, Ravi.

Vikram, if you remember, I think as part of the IFM, we have taken a lot of corrective actions about four, five quarters back, especially with respect to getting the business back on track, especially with respect to strategic price increases that we talked about in the past, including some of the site consolidation, taking out the excess cost. All that actions have been completed over a period of last four to six quarters, I would say.

Today, the integrated final mile, which is part of the ISCS business, in a very, very strong wicket.

Got it, sir. Thank you very much.

Hey, hi. Thanks a lot for the opportunity.

Congratulations to the team. All that you have been saying for a while, that turnaround has been seen in numbers for the last two quarters, and this quarter has been an improvement over the previous one, congratulations for that.

I have two questions. First is on the ISCS business, right?

It's heartening to see that ISCS has grown Q-o-Q as well, right, about 15% and Y-o-Y as well. Going forward, considering you have multiple projects into pipeline and scale-up of the North America project plus the wins that have happened, can we see this actually growing at 18%, 20%?

Is that a possibility going forward, primarily on the ISCS, which is a sticky business and then has higher margins?

It's a great question, and thank you for your wishes. We continue to focus a lot on the ISCS business.

Do we have the pipeline for that kind of growth? The answer is yes.

We just need to see how we can increase our conversion ratio from 22% maybe to about 23%, 24%, closer to 25%. I always remain optimistic about it.

Will it be an 18% growth? I definitely want to expect that, but I want to also set expectations that given what we can see, we're very confident of double-digit, we're very confident of early teens or even mid-teens in that segment.

I'll just leave it there to say that we'll aspire to get closer to that number that you spoke about. Do we have the pipeline?

Absolutely, yes. If we can convert some of the larger deals and if our conversion ratio increases, I don't see that as a difficult thing.

That's the focus of the company to see how we can increase the conversion rate of our pipeline.

Got it. Considering the top line is growing, and the EBITDA overall you expect to be flat to positive, your PBT margin from here on has to sequentially grow, right?

Q-o-Q as well, the PBT margin.

Yes. That is the trajectory for us in terms of PBT.

We have to get the PBT number growing every quarter, and we're very confident that we will do that.

Got it. The last one is on the exceptional items.

Is there any reason why this labor provisioning was not taken entirely in quarter three, and some has come in this quarter?

Yes, Kunal. I'll take this.

Vaidhy here. See, there was a Labour Ministry clarification which came in March 16th, after we declared the Q3 results, because of which, we had to once again do a reassessment and take an additional provision.

That clarity was not there when we closed the Q3 numbers. As there is still a lot of gray areas and there is a lot of interpretations as well.

That is what is the reason for that.

That's entirely taken now?

As of now, whatever clarification that has come, based on that we have completely taken it. Yeah.

Perfect. One last thing is on the impairment of the loss on financial instrument.

That's a sizable number as compared to your profit, right, about 17.6 crores, and that's sort of recurring every quarter. What is this?

What does this pertain to, and What can we expect for fiscal '26? How can we project this?

Kunal, this is basically what we keep providing based on the, expected credit loss, for all the customers and, the provisions that we take. I think this trend will more or less be, similar, because we have a very, very large revenue side, right, ₹11,000 crores.

On that, this number is not very material, but we we do continue to, closely monitor. Most of our customers are all high highly rated B2, you know.

We operate in the B2B segment, not in the B2C segment, there are no creditors, but we continue to take this as part of the ECL, expected credit loss methodology.

You have totally booked about 56 crores for fiscal '26. This sort of rate percentage to revenue should continue?

Is that understanding correct?

Probably, I would say slightly lower in FY27 onwards.

It should be lower in FY27. Okay.

Great. Thanks a lot, and wish you luck for the future.

Thanks, Kunal. Thank you.

Thank you. Thank you for all your time, questions, and continued interest in our journey.

As we look forward to FY27, we see significant opportunities to strengthen our market position, enhance operational resilience, and build deeper relationships with our customers. We also recognize the challenges that lie ahead from the macro to structural shifts in the global supply chain.

Our focus remains very clear: executing on our renewed customer conversion growth story, and continuing the disciplined implementation of our cost and productivity initiatives which we have set in motion, scaling segments and driving long-term value creation through disciplined customer-centric growth. I would like to personally thank all participants, both present and from the past, for your participation and valuable inputs.

As all of you would be aware, this would be my last earnings call. I'm confident that under the leadership of Mr.

Vikas Chadha, the company would soar to greater heights. I want to thank you once again for your support, and we at TVS SCS look forward to engaging with you in the quarters ahead.

We thank the management of TVS Supply Chain Solutions for giving us an opportunity to host the call and taking time out for interaction with the stakeholders. Thank you all for being on the call.