Ritco Logistics Ltd Management Discussions

Ritco Logistics Limited 2024-2025

Overview

At Ritco Logistics Limited, excellence is defined by our ability to deliver seamless, technology-enabled, and customer-centric logistics solutions. Established as a modest contract logistics provider serving a limited client base, Ritco has, over the years, evolved into one of India s most trusted integrated logistics and supply chain partners. Our journey has been guided by innovation, resilience, and a commitment to delivering services that meet global standards of efficiency and reliability. Today, Ritco operates with a workforce of over 1,000 skilled professionals across diverse verticals, supported by a robust governance and compliance framework. Our credibility is reinforced by ISO 9001:2000 certification and registration with Dun & Bradstreet s global commercial database , reflecting our commitment to transparency and quality assurance. Over the years, Ritco has consistently set new benchmarks in logistics through the adoption of cutting-edge technologies and operational best practices. As a comprehensive supply chain solution provider, Ritco offers an integrated portfolio of services including freight transportation, warehousing, contract logistics, and value-added solutions across India. Our freight capabilities span bulk load, dedicated load (round trip), full truck load (FTL), and less than truck load (LTL), serviced through a hybrid fleet model of owned vehicles and carefully managed third-party operators. Complementing this are our warehousing facilities and value-added services, which together provide end-to-end logistics support for corporate clients. The cornerstone of our competitive advantage remains our asset-light 3PL business model , strategically complemented by selective ownership of critical assets such as fleets and warehouses. This hybrid model not only enhances flexibility and scalability but also enables us to efficiently address diverse client requirements across industries. Beyond our core 3PL solutions, we also generate revenue through fleet rental services, offering smaller businesses and retail customers on-demand access to logistics capabilities. Through a culture of continuous innovation and operational excellence, Ritco remains committed to transforming the logistics ecosystem in India while consistently creating value for its stakeholders.

Industry Landscape and Key Trends

The Indian logistics industry, valued at over $228 billion in 2024, is experiencing a period of transformative growth. Key drivers include the e-commerce boom, strong government support, and increasing technological adoption. While facing persistent challenges like high costs and infrastructure bottlenecks, the sector is modernizing to become more efficient and globally competitive. Several transformative trends define the sector in 2025:

? Government initiatives: Policy support is a major catalyst for growth.

o National Logistics Policy (NLP) 2022 : Aims to reduce logistics costs from 13 14% of GDP to a global benchmark of 8% by 2030.

o PM Gati Shakti: A national master plan to accelerate multimodal infrastructure development and connectivity.

o Bharatmala and Sagarmala Projects: Initiatives to develop highways, ports, and inland waterways.

o GST Implementation: Has helped in streamlining interstate movement of goods and reducing transit delays.

? E-commerce boom: The rapid growth of e-commerce, especially in Tier-2 and Tier-3 cities, drives demand for faster, more reliable last-mile and hyperlocal delivery services.

? Infrastructure development: Massive investments in Dedicated Freight Corridors (DFCs), Multi-Modal Logistics Parks (MMLPs), and air cargo handling facilities are enhancing efficiency and capacity.

? Technology adoption: Digitalization is transforming the industry through real-time tracking, route optimization, warehouse automation, and AI-driven platforms. o Unified Logistics Interface Platform (ULIP): A government initiative to integrate data across different ministries, recording over 100 crore API transactions by March 2025.

? Manufacturing growth: The Make in India initiative and global supply chain shifts (China+1 strategy) are fueling demand for sophisticated logistics solutions.

? Growth of third-party logistics (3PL): Increasing demand for outsourced, end-to-end supply chain solutions from 3PL and 4PL providers.

Financial Performance Review

FY2024-25 saw Ritco reach new financial milestones:

? Strong topline growth (27% YoY) driven by sector expansion and Ritco s strategic contracts.. ? PAT increased 24% YoY to 40.6 Cr.

? EPS improved to 14.9 , reflecting value creation for shareholders. ? Operating margins stable at 7.5% , despite fuel cost headwinds.

3-Year Trend (Consolidated) :

Metric	FY23	FY24	FY25	CAGR %
Revenue ( Cr)	751.2	937.0	1,190	26%
Operating Profit	52.3	75.1	89.8	30%
Net Profit ( Cr)	24.3	32.7	40.6	29%
EPS ( )	9.97	13.5	14.9	22%

Key ratios indicate healthy leverage and solvency . Debt-to-equity remains moderate; interest and debt service coverage have improved in tandem with profit performance.

Analysis of key financial ratios:

The key financial ratios, such as the debt-to-equity ratio, interest coverage ratio, and debt service coverage ratio, provides valuable insights into Ritco Logistics Limiteds financial health and its ability to manage its financial obligations effectively. These ratios offer a comprehensive view of the companys leverage, solvency, and its capacity to meet its interest and debt repayment commitments.

Metrics	2025	2024
Debt equity ratio	1.38	1.40
Debt service coverage ratio	5.40	5.13
Interest service coverage ratio	3.15	3.00

Overall, the analysis of these financial ratios indicates that Ritco Logistics Limited has made progress in its financial management, with improvements in its ability to cover debt service obligations. Further, an improves interest coverage ratio might displays that the companys profitability remains adequate to sustain its interest payments.

Capital Structure and Funding

Ritco has issued further preferential equity shares in 2024 at premium to its initial IPO, displaying it has a strong market presence and is on consistent growth path. Banks has always supported us in availability of working capital through banking channels and the company has always optimised the use of funds basis the needs of operation thus keeping our debt cost flexible and optimised

Operational Highlights

? Network Expansion: Our continued effort to provide customised solutions tailored to customer requirements and increasing our reach to 2200+ destinations across India has gained trust of our 600+ customers allowing us to handle more than 4.5M+ tons of Cargo.

? Tech Upgrades: Investments in fleet management systems, real-time GPS, and digital aggregators have enhanced service predictability and efficiency.

? Sustainability: Route and load optimization, adoption fleet optimisation, reduced empty miles, and eco-packaging have minimized environmental impact.

? Customer-Centricity: High retention rates and satisfaction scores achieved through bespoke service models and transparent communication.

? Driver & Employee Welfare: Enhanced CSR with focused health and safety camps, medical screenings, education, and counselling.

Key Challenges

? High Fuel and Logistics Costs: Ongoing inflation and shifting supply chains mitigated via hedging, alternate fuels, and tech interventions.

? Regulatory Complexity: Navigated government compliance and audits with robust internal controls and best-governance frameworks.

? Talent Gap: Addressed with training, learning platforms, and leadership development programs.Chairman-Message-and-MDA.docx

? Weather & Disruption: Agile planning, diverse supplier networks, and flexible logistics modes safeguarded operational continuity.

Outlook and Strategy

The management s outlook for FY25-26 and beyond is based on the pillars of:

? Technology Integration: Scaling digital platforms, leveraging data analytics, and integrating acquired startups for seamless value addition.

? Expansion & Diversification: Entering new industry verticals, cross-border logistics, and export facilitation not relying solely on core sectors.

? Sustainability Commitment: Targeting reductions in emissions, green warehousing, and compliance with global ESG standards. ? Talent & Governance: Deepening employee engagement and adhering to gold-standard ethics and governance.

Corporate Governance & Social Responsibility

Strong compliance, code of conduct, and transparency standards, along with continued investment in holistic health, safety, and social programs for drivers and staff, position Ritco as an ethical leader in the industry.

Conclusion

Ritco always aims to be a customer oriented, multi-technology, specialized transport system in the Indian Market. It is our commitment to achieve excellence in all aspects of activity as well as pursue value-based policies to satisfy the aspirations of society, customers, vendors, employees and shareholders.

Forward Looking Statements

This report contains forward looking statements based on certain assumptions and expectations of future events. The Company cannot guarantee that these assumptions and expectations are accurate or will be realised. The Company s actual results, performance or achievements could thus differ materially from those projected in any such forward looking statements. The Company assumes no responsibility to publicly amend, modify or revise any forward-looking statements, on the basis of any subsequent developments, information or events.