Welcome to the 90th edition of The Chatter — a newsletter where we dig through what India’s biggest companies are saying and bring you the most interesting bits of insight, whether about the business, its sector, or the wider economy. We read every major Indian earnings call and listen to the interviews so you don’t have to.
We’re always eager to improve—please share your ideas on how else we can innovate “The Chatter” format to better serve your needs.
In this edition, we have covered 5 companies across 5 industries and a Regulator’s Speech.
Regulator
Chairman, SEBI
Defence
Mazagon Dock Shipbuilders Limited
Software Services
Mphasis Limited
Trading
Redington Limited
Retail
P N Gadgil Jewellers Limited
Logistics
TVS Supply Chain Solutions Limited
Regulator
Securities and Exchange Board of India | NaBFID Annual Infrastructure Conclave
The Securities and Exchange Board of India is the primary regulatory body overseeing the country’s capital markets and securities industry. It establishes frameworks for equity, debt, and alternative investment vehicles to ensure investor protection and efficient capital formation.
[Speech]
The corporate bond market has grown to ₹61 trillion, reflecting a significant shift toward market-based debt for long-term projects. Regulatory changes like lower investment thresholds and retail incentives are intended to make these bonds more accessible to individual investors.
“The growth in the corporate bond market has been substantial. During FY27 so far, companies have raised more than ₹4.3 trillion through the corporate bond market. Outstanding corporate bonds have increased from around ₹20 trillion in FY16 to ₹61 trillion, as at the end of August 2026. To strengthen this ecosystem, we have been taking several measures. To broaden the overall debt market, the threshold for the electronic book mechanism has been reduced. We have permitted incentives in public issues of debt securities to encourage retail participation and reduced the minimum investment size for privately placed bonds.”
— Shri Tuhin Kanta Pandey, Chairman, SEBI
SEBI is planning to simplify the process for small-value private debt issues by removing the need for a middleman merchant banker. This reduction in administrative costs will help smaller companies access the debt market more efficiently.
“We are also looking at the next layer of efficiency. For small-value debt private placements, we have proposed relaxing the mandatory requirement to appoint a merchant banker, subject to certain conditions. The objective is to reduce cost and delays while retaining investor protection.”
— Shri Tuhin Kanta Pandey, Chairman, SEBI
A new colour-coded risk rating system is being introduced to help retail investors quickly assess the safety of different bonds. Better risk transparency is expected to prevent mis-selling and encourage broader participation in the fixed-income market.
“At the same time, easier access must be accompanied by better investor understanding. We have proposed changes to the Advertisement Code for Online Bond Platform Providers and intend to introduce a standardised, colour-coded Credit Risk-o-Meter for debt securities. This will help investors — especially retail investors — better understand the credit risk of debt instruments and make more informed investment decisions.”
— Shri Tuhin Kanta Pandey, Chairman, SEBI
SEBI is testing the use of blockchain technology to issue corporate bonds as digital tokens. This pilot aims to modernise market infrastructure, potentially reducing transaction times and operational costs for issuers and investors.
“There is also scope to make the underlying market infrastructure more technology-driven. Our recent pilot for tokenised corporate bonds explores issuing a corporate bond as a native digital token on a private, permissioned DLT network operated by the Depositories. These initiatives are part of a broader objective — to make the bond market deeper, more efficient and more accessible, without weakening safeguards.”
— Shri Tuhin Kanta Pandey, Chairman, SEBI
The Alternative Investment Fund sector has seen commitments reach ₹17 lakh crore, serving as a critical source of patient capital. By lowering the entry threshold for Large Value Funds to ₹25 crore, the regulator aims to pull in more sophisticated private capital.
“The AIF ecosystem has emerged as an important source of alternative capital. As of the end of FY26, Category I Infrastructure AIFs had commitments of over ₹20,000 crore and investments of over ₹7,000 crore. Across all AIFs, cumulative commitments were about ₹17 lakh crore, while investments made stood at around ₹7.1 trillion (as of July 2026). For AIFs, our approach has been to provide flexibility while maintaining appropriate safeguards. To facilitate greater participation in this segment and support long-term investments, we have reduced the minimum investment threshold for Large Value Funds from ₹70 crore to ₹25 crore.”
— Shri Tuhin Kanta Pandey, Chairman, SEBI
Regulatory requirements for AIFs are being streamlined through digital unit holdings and simplified compliance for dormant funds. These operational changes are intended to reduce the administrative burden on fund managers and improve overall capital efficiency.
“We have also enabled flexibility for accredited-investor-only schemes and permitted encumbrance structures in infrastructure investments to support long-term financing. At the operational level, we have introduced lighter compliance for inoperative funds, flexibility in retaining liquidation proceeds in specified circumstances, and dematerialisation of AIF units and investments. We are also simplifying processes and reducing documentation, while exploring ways to further widen the accreditation framework.”
— Shri Tuhin Kanta Pandey, Chairman, SEBI
REITs and InvITs have successfully mobilised ₹2 lakh crore, becoming essential tools for recycling infrastructure capital. Their nearly ₹10 lakh crore in assets shows their growing importance as a stable, income-generating asset class for public investors.
“REITs and InvITs have introduced an important dimension to the infrastructure financing ecosystem. They provide a mechanism through which completed, income-generating assets can be monetised and brought within the investment universe of a wider set of investors. The growth is visible. There are currently 6 SEBI-registered REITs and 27 InvITs. Together, they have mobilised more than ₹2 lakh crore over the last seven years, with assets under management of around ₹9.2 lakh crore at the end of FY26.”
— Shri Tuhin Kanta Pandey, Chairman, SEBI
The reclassification of REITs as equity for mutual funds allows for significantly higher institutional investment into these vehicles. This shift is expected to improve liquidity and help stabilise valuations for infrastructure trusts.
“We have taken several measures to support this evolution. The scope of strategic investors has been expanded to facilitate wider participation. REITs have been reclassified as equity for investment by mutual funds. We have also permitted REITs and InvITs to invest in liquid mutual funds with minimum credit risk for managing short-term liquidity, and expanded the EBP framework to these instruments to strengthen price discovery.”
— Shri Tuhin Kanta Pandey, Chairman, SEBI
Local city governments are starting to tap capital markets, though the municipal bond market remains in its early stages. For this segment to grow, local bodies must improve their financial reporting and demonstrate reliable cash flows to investors.
“Municipal bonds can connect these infrastructure requirements with the capital market. The segment is still relatively small, but progress is visible. As of end-FY26, 22 urban local bodies had raised more than ₹4,500 crore through 31 municipal bond issuances. The next phase will require continued focus on municipal creditworthiness, governance, disclosure and predictable project cash flows. If these foundations strengthen, municipal bonds can become an increasingly important source of funding for India’s urban infrastructure.”
— Shri Tuhin Kanta Pandey, Chairman, SEBI
SEBI’s roadmap focuses on broadening the pool of investors for infrastructure assets and improving trading liquidity in the bond market. A key upcoming change is the expansion of the ‘Accredited Investor’ definition to unlock more domestic risk capital.
“Looking ahead, I see specific areas where further progress can deepen this ecosystem. First, widening participation in REITs and InvITs. There is scope to bring in more domestic institutional capital, global long-term investors and retail participation. Second, deepening the corporate bond market. We need a wider issuer base, greater participation and better secondary-market liquidity. Third, continuing to evolve the AIF framework. We have proposed to review the Accredited Investor Framework to widen access for sophisticated investors, deepen the pool of domestic and foreign risk capital, and strengthen the market ecosystem.”
— Shri Tuhin Kanta Pandey, Chairman, SEBI
The regulator aims to create a ‘capital engine’ where funds are continuously recycled from mature projects into new infrastructure builds. This systemic approach is intended to ensure that capital is available at every stage of an asset’s lifecycle.
“This brings us to fundamental questions: Can we mobilise capital to build? Can we provide the right form of capital as the project develops? Can we unlock capital from mature assets? And can that capital be deployed again into the next generation of infrastructure? If we can do this well, the securities market becomes more than a financing channel. It becomes a continuous capital engine for infrastructure. This, I believe, is the opportunity before us — to build an infrastructure financing ecosystem where banks, equity markets, bond markets, AIFs, REITs, InvITs, municipal bodies, institutional investors and regulators each contribute to different parts of the same journey.”
— Shri Tuhin Kanta Pandey, Chairman, SEBI
Defence
Mazagon Dock Shipbuilders Limited | Mid Cap
Mazagon Dock Shipbuilders is India’s leading defence public sector shipyard, specialising in the construction of warships and submarines for the Indian Navy. The company is currently diversifying its operations by establishing greenfield commercial shipbuilding clusters to expand its scale.
Management is planning a significant investment of roughly 15,000 crore for their upcoming greenfield expansion project. This massive spending plan indicates the company’s commitment to scaling up its manufacturing capacity for the next decade.
“Our preliminary feasibility study estimates a total investment of approximately ₹15,000 crore. Following our internal DPR and consultant recommendations, we will seek formal approvals from our Board and the government.”
— Ruchir Agrawal, Director of Finance
The company is targeting double-digit margins for its new commercial shipbuilding venture, supported by government policy frameworks. This guidance helps investors understand the profitability expectations for this new, non-defence business segment.
“Under the Maritime Amrit Kaal framework, supported by central and state incentives, we target a return on equity/revenue return profile of 15% to 17% for investors. ... Yes, 15% to 17% represents our targeted margin profile. The exact top-line revenue potential will depend on order inflows and annual vessel construction throughput, which will be calculated upon completion of our internal DPR.”
— Ruchir Agrawal, Director of Finance
The long-awaited submarine project with German partners is in the final stages of government approval. Winning this major contract would provide a massive boost to the company’s order book and long-term revenue visibility.
“To clarify, the project is Project 75(I), conducted in partnership with ThyssenKrupp Marine Systems (TKMS) Germany. Commercial negotiations and bid submissions are complete; the decision rests with the Government of India, and we expect contract finalisation soon. ... While the government determines the exact timing, we anticipate approval very shortly—and certainly within the current fiscal year.”
— Ruchir Agrawal, Director of Finance
Mazagon Dock is actively bidding for several high-value naval defence projects, including a 70,000 crore frigate contract. A strong pipeline of naval orders suggests continued dominance in the domestic warship manufacturing market.
“The MCMV project remains in the pipeline. Additionally, the Indian Navy issued the Request for Proposal (RFP) for Project 17B (Next-Generation Frigates) valued at approximately ₹70,000 crore, for which we plan to bid. We also expect order placement for additional Destroyer-class vessels (Project 15B / 15C variants) during this financial year, as we have already demonstrated construction capability.”
— Ruchir Agrawal, Director of Finance
The company is managing to keep current project costs stable despite potential market volatility in raw material prices. This cost control helps protect the firm’s profitability during the lengthy manufacturing cycles of warships.
“We are closing our half-yearly accounts as of September 30th and will share specific figures post-audit. However, our ongoing order execution faces no inflationary headwinds on raw materials, as domestic inflation remains well-controlled. All active projects are proceeding within projected costs.”
— Ruchir Agrawal, Director of Finance
Despite the shift toward competitive bidding in defence contracts, Mazagon Dock believes its technical experience will allow it to maintain strong margins. This suggests the company has enough operational efficiency to compete effectively against other shipbuilders.
“Competitive bidding requires higher operational efficiency. However, as an experienced shipbuilder, our accumulated technical competency and construction efficiency allow us to protect margin profiles despite competitive bidding structures set by the Indian Navy.”
— Ruchir Agrawal, Director of Finance
Software Services
Mphasis Limited | Mid Cap
Mphasis is a global information technology solutions provider specialising in cloud and cognitive services. The company primarily serves the banking, financial services, and insurance (BFSI) sectors with a focus on digital transformation.
Management believes that while the global economy remains unpredictable, it is stable enough for them to focus on winning specific client deals. This suggests the company’s growth depends more on its own sales execution than on a broad market recovery.
“Over the last four to six quarters, we have maintained that the macroeconomic environment would remain uncertain. Themes across geopolitics, interest rates, and inflation have not changed significantly over the past 12 to 18 months. While the macro hasn’t improved, it hasn’t meaningfully deteriorated either. Our performance thesis is driven primarily by micro-level execution—focusing on deal flow, account-level activity, and pipeline closures across specific verticals and clients. From that standpoint, our stance remains unchanged from our earnings commentary six weeks ago. We are not calling out any shift in performance, given our focus on closing opportunities currently in the pipeline.”
— Nitin Rakesh, CEO
The company is prioritising spending on its own technology platforms and training its staff to use them effectively. Investors should see this as a move to offer higher-value services that are harder for competitors to replicate.
“We deploy capital across three core vectors: 1. Internal IP & Platform Build: Investing heavily in our proprietary platform and asset strategy, which we announced in Q1. This involves combining IP assets, platforms, and re-skilled teams to drive outcomes for enterprise clients.”
— Nitin Rakesh, CEO
The company uses its cash to buy specific client contracts or grow its share of work within its current customer base. This provides a low-risk way to increase revenue without the complications of integrating an entirely new company.
“3. Contract Acquisitions: Deploying capital to expand wallet share within existing accounts or acquire customer contracts that allow creative entry into new enterprise clients. This three-pronged strategy represents a disciplined use of capital without introducing excessive operational risk to the business.”
— Nitin Rakesh, CEO
While management is open to major deals, they are currently avoiding large and potentially risky acquisitions. This disciplined approach suggests they want to avoid the integration headaches that often plague big IT mergers.
“Never say never, but we remain focused on our three stated vectors. If a compelling, highly value-accretive opportunity arises that does not introduce disproportionate risk, we will evaluate it. However, we are not actively pursuing a “big bang” M&A deal at this time.”
— Nitin Rakesh, CEO
Management clarifies that their growth is coming from their own sales and operations rather than just buying other companies. This gives investors more confidence that the business is fundamentally healthy and not just buying growth.
“The vast majority of our growth is organic. Contract acquisitions are primarily deal-structuring mechanisms—a vendor consolidation playbook to secure client opportunities—rather than traditional inorganic corporate acquisitions. They represent a very small percentage of revenue. Therefore, the bulk of our guided revenue growth is organic.”
— Nitin Rakesh, CEO
Although high interest rates hurt the mortgage business, they actually help large banks earn more, which keeps their spending budgets stable. This balance protects the company’s largest business segment even when some parts of the economy are struggling.
“While interest-rate-sensitive segments like mortgages face headwinds, the broader BFS sector remains structurally strong. Elevated yields enhance net interest income for large banking institutions, keeping their balance sheets healthy. Furthermore, BFS clients are early adopters of the AI technology cycle, creating significant opportunities for us to help them modernise infrastructure and deploy new capabilities.”
— Nitin Rakesh, CEO
The gap between new AI tools and how companies actually use them is large, which means there is a lot of work left for IT services firms. Mphasis stands to benefit from helping companies build the basic infrastructure needed to actually run these AI tools.
“Tool development has outpaced enterprise adoption by a wide margin. A deceleration in foundational AI tool R&D will not slow enterprise adoption, as enterprises are currently focused on building the underlying software, physical, and intellectual infrastructure required to deploy AI at scale. Enterprise focus centres on technology transformation and measurable outcomes, which strongly aligns with our platform-first strategy.”
— Nitin Rakesh, CEO
Trading
Redington Limited | Small Cap
Redington Limited is a leading technology integrator and distributor providing supply chain solutions for global brands in IT and mobility. The company is transitioning from traditional hardware distribution to a high-margin technology orchestrator focusing on AI, cloud, and managed services.
Redington is seeing a shift where Indian consumers are increasingly choosing high-end smartphone models over base versions. This premiumization trend helps the company by increasing the average selling price and tapping into demand for new features like AI and health tech.
“In India, premiumization is an active trend. The premium customer segment constantly seeks new, best-in-class devices. Pro and Pro Max models are accounting for a larger percentage of total sales globally, and even in India, premium buyers are shifting toward Pro and Pro Max variants. Consumer focus is moving to new features like camera technology, AI capabilities, and health monitoring. All new product introductions have received a strong market response. While the base product will attract significant attention when launched later, we are very pleased with the initial demand for the iPhone 17 line, alongside the 18 Pro, Pro Max, and Duo models.”
— V. S. Hariharan, Managing Director and Group CEO
Management explains that they are positioned across the entire AI hardware and software value chain, from cloud hyperscalers to local data centres. This broad presence allows them to act as an orchestrator for businesses that need complex, hybrid AI setups.
“AI infrastructure is complex, with multiple operational layers: 1. Hyperscalers: Cloud-based AI compute offerings and AI control planes (e.g., Bedrock, Foundry, Vertex) have experienced strong growth. 2. Enterprise Hardware: Enterprise hardware transitions from CPU to GPU compute platforms. 3. Non-Hyperscaler Cloud & Data Centres: Specialised AI compute data centre operators serving sovereign and non-sovereign workloads. 4. Edge & Private Cloud: Edge data centres and private cloud infrastructure. Redington operates across all four layers, bridging hardware brands, hyperscalers, local operators, and partners to deliver integrated solutions. Above this infrastructure, we deliver Software-as-a-Service (SaaS), platform software, application software, and managed services. Enterprises deploy hybrid configurations across on-premises servers, cloud platforms, and colocation facilities, and Redington orchestrates solutions across these environments.”
— V. S. Hariharan, Managing Director and Group CEO
The company plans to double its revenue from software and services to $5 billion over the next few years. This shift is critical because this segment is more profitable than its traditional hardware distribution business.
“Historically, our baseline Profit After Tax (PAT) margin has ranged between 1.4% and 1.5%. Our Software Solutions and Services Group (SSG)—which carries higher gross margins and profitability—currently contributes about 17% to revenue in India and 30% to 35% globally. We previously communicated a public target to expand our SSG revenue from $2.3–$2.4 billion currently to $5.0 billion within two to three years. As AI infrastructure, solutioning, and managed services expand, SSG growth will drive our transition from traditional distribution to technology orchestration.”
— V. S. Hariharan, Managing Director and Group CEO
Redington is focusing on helping companies move from just testing AI to actually getting financial benefits from it. By providing pre-built AI agents and training partners, they aim to standardise and scale the deployment of AI solutions across various industries.
“While 90% of enterprises are experimenting with AI, only 30% to 40% have achieved measurable bottom-line returns. Realising ROI depends on deploying specific enterprise use cases, applications, and AI fluency. Redington is positioning itself in enterprise use case deployment through several initiatives: AI Exchange Platform: We launched a platform hosting nearly 500 pre-built AI agents across 20 Independent Software Vendors (ISVs), designed for rapid vertical and horizontal deployment or enterprise customisation. ISV Partnerships: Partnering with hundreds of technology providers to deliver comprehensive AI solutions. Partner Academy: Training our channel partner network to build AI fluency across the sales ecosystem. Centres of Excellence (COEs): Establishing physical and virtual demonstration centres—starting with Singapore, and adding Bengaluru, Dubai, and Saudi Arabia—to demonstrate standardised, “cookie-cutter” AI use cases.”
— V. S. Hariharan, Managing Director and Group CEO
The company is moving away from labour-intensive individual consulting toward a scalable model of distributing ready-to-use AI solutions. This transition marks a fundamental change in their business model from a logistics-heavy distributor to a technology solution provider.
“Rather than solving problems enterprise-by-enterprise via bespoke consulting, our strategy enables the ISV, brand, and partner ecosystem to deploy standardised AI solutions at scale. We are moving beyond pure hardware distribution into use-case solutioning and solution distribution.”
— V. S. Hariharan, Managing Director and Group CEO
New AI-focused services are intended to make relationships with clients more permanent and less likely to be disrupted by competitors. This strategy layers high-margin service revenue on top of their existing high-volume distribution network.
“That is a fair assessment. While it is early days, this strategy creates customer stickiness and establishes a new high-margin revenue line that sits atop our distribution scale.”
— V. S. Hariharan, Managing Director and Group CEO
Management is aiming to increase their operating profit margin to 2.5% from the current level of around 2.1%. While they acknowledge higher targets might be difficult, they are committed to this steady improvement through a better mix of products and services.
“To clarify the metrics: our overall PAT margin target is 2.0% (up from 1.4%–1.5%). At the operating level, our EBITDA margins currently sit between 2.1% and 2.2%. While reaching a 3.0% EBITDA margin may be overly aspirational, we are actively targeting an EBITDA margin expansion toward 2.5%.”
— V. S. Hariharan, Managing Director and Group CEO
Retail
P N Gadgil Jewellers Limited | Small Cap
P N Gadgil Jewellers Limited is a leading Indian jewellery retailer with a centuries-old legacy, primarily focused on the Maharashtra market. The company designs and sells a wide range of gold, silver, and diamond jewellery through various retail formats, including large-format legacy stores and lightweight-focused ‘U by PNG’ outlets.
Consumer demand has recovered after a slow start to the quarter, with a clear shift from investment products toward actual jewellery. This trend is beneficial for the company because jewellery sales typically carry higher profit margins than gold bars or coins.
“As you noted, August started somewhat slowly due to policy announcements regarding gold purchases, but demand picked up as Shravan began. At PNG Jewellers, we hosted the Mangalsutra Festival during Shravan, followed by Ganesh Chaturthi, and market footfalls remain healthy. Notably, consumer preference over the quarter shifted toward jewellery buying rather than investment products like gold bars and coins. Silver demand also saw a noticeable surge during Ganesh Chaturthi. Overall consumer sentiment remains positive, and as the industry heads into Navratri and Diwali, we are well-positioned for strong festive sales.”
— Saurabh Gadgil, Chairman and Managing Director
The company is seeing a regional shift where customers in North India are becoming more comfortable with lower-purity gold options like 14-carat. This allows the business to offer a wider variety of price points and designs to younger and budget-conscious shoppers.
“In Maharashtra, plain gold jewellery demand continues to be dominated by 22-carat gold, while diamond jewellery is crafted in 18-carat. However, as we expand northward into Central and North India, 14-carat plain gold jewellery is gaining broader consumer acceptance. We are also experimenting with 9-carat jewellery in select markets—specifically targeted at younger demographics and online shoppers for items like chains, bracelets, and rings. Consumer purchasing is shifting from strict caratage requirements toward design and budget preferences. While lighter-carat options (18-carat, 14-carat, and 9-carat) are expanding, 22-carat remains our core offering alongside lower-carat collections.”
— Saurabh Gadgil, Chairman and Managing Director
Management is executing a multi-year plan to transition from a regional Maharashtra player to a national jewellery brand. Expansion is specifically targeting high-growth corridors in Central and North India to diversify the company’s geographical revenue base.
“As outlined during our investor calls, our 3-year strategic framework focuses on expanding from our core base in Maharashtra into a nationwide footprint. We currently operate across seven states, with targeted expansion along the Maharashtra, Goa, Madhya Pradesh, Uttar Pradesh, Bihar, and Delhi-NCR belts.”
— Saurabh Gadgil, Chairman and Managing Director
The company uses a dual-store strategy to capture both high-value bridal purchases and high-frequency impulse buys. Reaching the target of 103 stores by the end of the fiscal year will be a significant milestone for its retail scale.
“Our retail approach utilises two distinct store formats: 1. PNG Legacy Stores: Large-format flagship stores offering traditional and heavy bridal jewellery. 2. U by PNG: A specialised retail format focused on lightweight, non-occasion, lower-caratage impulse-purchase jewellery. Both retail formats operate cohesively, and we plan to close the current financial year with a network of 103 operational stores across a mix of legacy and U by PNG locations.”
— Saurabh Gadgil, Chairman and Managing Director
Diamond and studded jewellery are growing much faster than the core gold business, posting 40% annual growth. Investors should watch this segment closely as its increasing share in the product mix will likely drive higher overall corporate margins.
“Studded jewellery performance has been exceptionally strong at PNG Jewellers, with our diamond segment growing at over 40% year-over-year. While diamond jewellery currently accounts for 12% to 13% of our overall sales mix, it remains a rapid-growth category.”
— Saurabh Gadgil, Chairman and Managing Director
Jewellery now accounts for the vast majority of gold revenue, while lower-margin bullion has dropped to just 20%. This healthy revenue split suggests that the company is effectively capturing value-added design margins rather than just acting as a commodity trader.
“In terms of gold, consumer purchases are heavily skewed toward jewellery rather than bullion; bullion sales currently account for roughly 20% of total revenue, while jewellery represents the remaining 80%. This strong tilt toward jewellery—supported by customers exchanging old gold for new designs—bodes very well for long-term sector profitability.”
— Saurabh Gadgil, Chairman and Managing Director
Logistics
TVS Supply Chain Solutions Limited | Mid Cap
TVS Supply Chain Solutions provides technology-driven integrated supply chain services to enterprise customers across the automotive, industrial, and consumer sectors. The company operates a global network focusing on specialised logistics, including manufacturing support and spare parts maintenance.
The company has formed a strategic alliance with Sankyu Corporation involving a small equity stake to ensure long-term commitment. This partnership helps the company enter high-growth sectors like smart manufacturing and semiconductors in India.
“There are two key dimensions to the partnership we are entering into with Sankyu Corporation: 1. Business & Commercial Association: We will collaborate operationally on the business side to offer the specialised supply chain solutions and services Sankyu has provided to its Japanese clients for decades, bringing them to multinational and domestic customers in India. 2. Equity Investment: To bring seriousness, responsibility, and ownership to the alliance, Sankyu has decided to acquire a 0.5% equity stake in the company, subject to regulatory approval. This brings together two 100-year-old organisations with shared values around employee focus and customer-centricity. It will significantly broaden the scope of solutions supply chain companies offer Indian customers, especially given the government’s strong impetus toward manufacturing, smart manufacturing, and advanced semiconductors.”
— Vikas Chadha, CEO
The company is partnering with global experts to bring specialised aerospace and defence logistics capabilities to India. These high-barrier sectors provide access to long-term contracts with major global aerospace manufacturers.
“Our goal is to deliver high-speed, high-quality services to Indian customers by partnering with global market leaders: ALA Group brings 35 years of aerospace and defence logistics experience alongside partnerships with OEMs like Boeing and Airbus to India. Sankyu Corporation: Leverages over a century of experience serving Japanese clients, introducing specialised engineering supply chain services to strengthen our portfolio.”
— Vikas Chadha, CEO
Despite global logistics headwinds like rising fuel prices and route delays, the company can pass these costs to customers. Additionally, clients are increasing inventory buffers in India, which is actually driving higher volumes for the business.
“Global supply chains face two primary headwinds: rising costs driven by higher fuel prices, and extended transit times caused by container unavailability and route blockages. However, this environment also presents significant commercial opportunities. Many of our multinational Fortune 500 clients are building parallel supply chain hubs and increasing inventory buffers in India to protect customer delivery schedules. Because our priority is ensuring supply continuity for enterprise clients, inventory volumes across our network are rising. While input prices are escalating, our contractual structures allow us to pass these cost increases directly through to customers while capturing incremental volume growth.”
— Vikas Chadha, CEO
Most client contracts include clauses that protect the company’s profit margins from fluctuations in shipping and fuel costs. This stability in the freight forwarding business is a key pillar of their overall margin protection strategy.
“Yes, the majority of our contracts are structured with cost-pass-through mechanisms that allow us to pass cost increases on to clients, as reflected in our freight forwarding business delivering a 4% EBITDA margin.”
— Vikas Chadha, CEO
Management is guiding for mid-to-high teen revenue growth in FY27 with a focus on improving operational efficiency. The expectation that profits will grow faster than revenue indicates that the company is reaching a stage of strong operating leverage.
“Over the last two quarters, we added ₹500 crore in new annualised revenue, supported by a robust deal pipeline and very low customer churn. For FY27, I am confident we can deliver mid-to-high teen consolidated revenue growth, with consolidated EBITDA expanding at a significantly faster rate than top-line revenue.”
— Vikas Chadha, CEO
The company maintains a large deal pipeline and expects a consistent conversion rate of around one-fourth of these opportunities. This consistent win rate provides a clear path to adding ₹2,000 crore in new revenue annually.
“Conversion rates should remain in the vicinity of 20% to 25%. Our solutions involve complex, long-gestation enterprise projects requiring extensive consultation with clients to structure. A 20% to 25% conversion rate will allow us to close the year with over ₹2,000 crore in new annualised revenue additions to build our base.”
— Vikas Chadha, CEO
The company is targeting a 4% PBT margin by shifting its service mix toward higher-value verticals and optimising costs. Management believes this goal is achievable regardless of volatility in global freight rates.
“Yes, we are progressing toward a 4% PBT margin target. This margin trajectory is driven by our product mix, the addition of higher-margin specialised verticals, internal cost optimisation, and active pricing levers. Global freight rate volatility will not impact our execution ability or our path toward reaching our 4% PBT margin target.”
— Vikas Chadha, CEO
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