TVS Supply Chain hits highest level since listing; soars 20% in 2 days

The company made stock market debut on August 23, and is currently trading 23 per cent higher over its issue price of Rs 197 per share

Shares of TVS Supply Chain Solutions were trading higher for a second straight day, surging 9 per cent in Friday's intraday trade to Rs 241.55 on the BSE. In the past two trading days, the stock of the recently listed logistic solution provider firm has soared 20 per cent. Currently, it is quoting 23 per cent higher against its issue price of Rs 197 per share. The company made stock market debut on August 23.

The IPO had received a decent response as the issue was subscribed to 2.85 times overall. The retail category was subscribed 7.89 times, qualified institutional buyer (QIB) category 1.37 times, and the non institutional investor (NII) category 2.44 times.

TVS Supply Chain Solutions (TVS SCS), a subsidiary of TVS Mobility Group, is a leading integrated supply chain solutions provider in India. With substantial revenue and growth in fiscal 2023, TVS SCS operates across over 25 countries - serving 8,778 global and 902 domestic clients in FY23. The company caters to diverse sectors such as automotive, industry, consumer products, technology, rail, utilities, and healthcare.

Although TVS SCS is a leading supply chain management company, it operates in a highly competitive industry and has reported losses in the past two years. The board of directors of the company is scheduled to meet on Monday, September 11, 2023 to consider the financial results for the quarter ended June 30, 2023.

According to TVS SCS, the Indian logistics industry is bound to see an increase in outsourcing of logistics services across sectors as we progress towards reducing overall logistics costs from 13-14 per cent to single digit. Better utilisation of infrastructure and logistics assets will be possible only through increase in outsourcing. This will be combined with higher use of technology and implementation of tech enabled solutions to solve supply chain complexity.

The market witnessed a strong post-Covid recovery in FY22. The market grew by 14 per cent and was valued at $435 billion in FY22. It is projected to grow to $591 billion by Fiscal 2027, TVS SCS said in its FY23 annual report.

The Government released the National Logistics Policy in September 2022, which lays out a roadmap for modernisation and growth of logistics sector. This policy will give impetus to tech-enabled logistics sector as is intended, to improve the logistics sector's coordination and efficiency, according to TVS SCS.

Meanwhile, for August, 2023, freight movements across all modes of transportation witnessed healthy growth, with GST e-way bill generation up 20 per cent year-on-year (YoY), cargo volumes carried by Indian Railways (IR) growing 6.4 per cent YoY, and major port volumes improving 4.4 per cent YoY.

"Healthy growth in GST e-way bill generation bodes well for road logistics service providers such as the shift from the unorganised sector seems imminent with increasing compliance requirements under the GST regime," analyst at Emkay Global Financial Services said in logistics sector update.