Mahindra Logistics assesses significant impact due to Covid-19 crisis, stock slips 1%

The revenue in Q1FY21 could be lower by as much as 50% to 60% as compared to a normal quarter.

Jun 05, 2020 09:06 IST India Infoline News Service

Mahindra Logistics
Mahindra Logistics Ltd informed the exchanges on Thursday that its business has been significantly impacted over last few months and further deepening of the current Covid-19 crisis may adversely affect the operations of the company and its subsidiaries across locations in India.

As per company’s assessment, there could be significant impact on revenue and profitability for Q1FY21 as its operations were partially shut in March have resumed and gradually been increasing from end of April 2020 and have been gradually ramping up in May 2020. The operations in end markets have also been disrupted on account of Covid-19 and therefore demand in end markets have been impacted as well.

“The revenue in Q1FY21 could be lower by as much as 50% to 60% as compared to a normal quarter driven by above stated circumstances and the profitability would be impacted as well in line with reduction in revenue.”

Further, the Company has recently obtained its Board of Directors approval for augmenting additional borrowings upto an aggregate amount of up to Rs250cr to address any exigency if it may arise.

The rampant spread of Covid-19 outbreak, followed by countrywide lockdown announced by the Government of India from March 25, 2020, resulted in the operations of the company perform at a sub optimal level.

While almost all of the operating sites were under lockdown mode during the national lockdown phase, the units catering to essential commodities across Fast Moving Consumer Goods ("FMCG"), Pharmaceutical and ECommerce sectors continued operations.

Our head office in Mumbai and all other offices spread across the country remained closed following directives from the respective Governments. We had initiated Work from Home since mid-March and have ensured normalcy in daily operations with remote working, it said.

Mahindra Logistics Ltd is currently trading at Rs291.40, down by Rs3.9 or 1.32% from its previous closing of Rs295.30 on the BSE.

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