Corporate Grapevine

Published: Mar 31, 2022
Updated: Mar 31, 2022

End-to-end logistics provider

Gateway Distriparks

The amalgamation between three group companies — Gateway Distriparks Ltd (GDL), Gateway East India Pvt Ltd (GEIPL) and Gateway Rail Freight Ltd (GRFL) – took place recently via merger by absorption. Under the scheme, the BSE-NSE listed GDL and unlisted GEIPL got merged with GRFL. Subsequently, GRFL has been re-named Gateway Distriparks Ltd and the rechristened entity is now listed on both the leading stock exchanges.

The shareholders of the erstwhile listed GDL have been issued four equity shares of the new company against one equity share that they held. Post amalgamation, GDL’s fresh equity capital has become Rs 499.64 crore (face value Rs 10 each) wherein the promoter group holds 32.12 % whereas the remaining 67.88% is shared by 44,754 public shareholders. The eight mutual funds, including ICICI Prudential, Mirae Asset, SBI MF, Franklin and HDFC MF, collectively hold nearly 27% and have emerged as the second largest shareholder group. The company is one of India’s leading private intermodal operators with two business verticals — rail and container freight stations (CFS).

Rail Vertical (RV)

Under RV, the company provides intermodal logistics services and operates its own raillinked inland container depots (ICD) at four locations in India, with an annual handling capacity of 6 lakh+ TEUs and warehousing space of about 42,000 sq m. The terminal locations are Gurugram, Faridabad, Ludhiana and Viramgam (near Ahmedabad). The company operates a fleet of 31 BLC train sets with a pan-India railways licence and provides regular container train services from these ICDs to Nhava Sheva, Mundra and Pipavav ports for movement of EXIM, domestic as well as reefer containers.

GPL also offers a last-mile connectivity to its customers through own fleet of 500+ trailers, making it an endto-end logistics solution provider, being monitored through a centralized control room 24X7 and well aligned with the western dedicated freight corridor

Container Freight Station (CFS)

The company is a leading pan-India CFS operator with two and a half decades of experience, with well- connected CFS facilities in close proximity to the ports of Nhava Sheva, Chennai and Krishnapatnam. These facilities are spread over an area of 125 acres, have warehousing space of about 75,000 square metres and are designed to handle an annual throughput of 6,00,000 TEUs. Likewise, another CFS at Vizag is spread over 20 acres, has a warehousing space of 3,000 square metres and is designed to handle throughput of 70,000 TEUs per annum.

The management feels that the amalgamation will create greater operational synergies and efficiencies at multiple levels of business operations and will provide significant impetus to their growth. In addition, it could also improve earnings, cash flow and better debt servicing abilities so as to eventually offer greater economies of scale and a bigger and stronger resource base for future growth.

LOW DEBT

GDL has an investment of Rs 104.17 crore in one of its associates, listed company Snowman Logistics Ltd, as its promoter and holds a 40.25% stake. This investment is being valued at Rs 221.94 crore at its current market price of Rs 33 per share.

Very recently, the company redeemed nonconvertible debentures of Rs 287.82 crore wherein Rs 7.82 crore was paid towards the interest component. With this, now the NCD balance is nil and as on date the company is left with a net debt of Rs 306 crore. This would obviously help reduce its finance cost hereon.

Considering from various perspectives, it appears that Gateway Distriparks’s business verticals are sound and is on strong wicket. Moreover, the sectoral outlook is also looking bright. At the current market price of around Rs. 70, the company is valued at around Rs. 3500 crore.