At a glance:
CONCOR (Container Corporation of India Ltd), the Navratna CPSE darling of India’s freight logistics game, posted a healthy ₹1,698 crore profit before tax in FY25. Along with that, it’s raining dividends (₹11.5/share total!) and even a 1:4 bonus issue. But wait—auditors are waving red flags on land lease accounting, 3-year-old trade receivables, and some chunky balance sheet mysteries. So should investors be euphoric… or cautious?
🚛 About the Company
- CONCOR is a government-owned, multi-modal logistics giant.
- Dominates the EXIM and domestic container freight movement game across India.
- Core operations: rail freight, terminals, and warehousing.
- It’s the IRCTC of Freight — except with way more containers and way fewer samosas.
🧠 Key Managerial Personnel (KMP)
| Name | Designation |
|---|---|
| Sanjay Swarup | Chairman & MD |
| Board | Mix of Govt nominees & executives |
(PS: From Nov 2024 to March 2025, they didn’t have any Independent Directors. SEBI must be thinking “Bhai ye kya startup jaisa kar rahe ho?”)
📊 FY25 Financials (Standalone)
| Metric | FY25 (₹ Cr) | FY24 (₹ Cr) | YoY Growth |
|---|---|---|---|
| Revenue from Ops | 8,863.37 | 8,632.49 | +2.7% |
| Other Income | 465.16 | 378.27 | +23% |
| Total Income | 9,328.53 | 9,010.76 | +3.5% |
| Rail Freight Expense | 5,022.02 | 4,910.09 | +2.2% |
| PAT (Standalone) | 1,271.98 | 1,230.79 | +3.3% |
| EPS | ₹20.88 | ₹20.20 | +3.4% |
| Cash from Ops | ₹1,665 Cr | ₹1,369 Cr | +21.6% |
Not bad. But…
🧾 Dividend + Bonus Party 🎉
- Final Dividend: ₹2/share (in addition to ₹9.5 already paid as 3 interim dividends)
- Total for FY25: ₹11.5/share
- Bonus Issue: 1:4 (one free share for every 4 held) — subject to shareholder approval.
🧻 Translation: If you hold 400 shares, you’ll get 100 bonus shares and ₹4,600 as dividend. Nice gift hamper from PSU uncle.
🧮 Forward Value (FV) Calculation
Let’s try valuing this train before boarding it.
- CMP: ₹740
- EPS (Standalone): ₹20.88
- Logistics companies generally trade at 20–25x P/E (Adani Ports: 25x, TCI: 24x)
| Valuation Basis | Estimated FV |
|---|---|
| 20x EPS | ₹417 |
| 25x EPS | ₹522 |
| Edu FV (Blended) | ₹470 |
👀 CMP ₹740 vs FV ₹470 = Overvalued by ~57%
Unless PSU premium kicks in like magic, this isn’t screaming “multibagger” right now.
🧾 Balance Sheet Forensics: Auditor’s Laughter Yoga Begins
CONCOR’s audit report is a gold mine of red flags (in auditor-speak):
1. No Right of Use (ROU) for leased land from Railways
- Indian Railways charges 6% of market value as Land License Fee (LLF), with 7% annual escalation.
- CONCOR didn’t recognize lease liabilities or ROU assets citing “uncertain lease terms”.
- That’s a direct Ind AS 116 violation. Auditor said: “Okay… your opinion, not ours.” 🧍♂️
2. ₹24.56 Cr stuck in receivables for 3+ years
- Provisioned for ₹4.84 Cr. Rest ₹19.72 Cr? Let’s call it “hope accounting”.
- Auditor: “Sir, legal notices bhej diye, par paisa milega ya nahi… dekhte hain.”
3. Unconfirmed balances from Railways and others
- Debtors/creditors running unconfirmed for years.
- Auditor: “Not quantifiable. But someone is sleeping on this.”
📦 Segment Insights
| Segment | FY25 Revenue (₹ Cr) | FY25 PBT (₹ Cr) |
|---|---|---|
| EXIM | 5,733 | 1,315 |
| Domestic | 3,130 | 239 |
- EXIM = Profit machine, but volume growth is stagnant.
- Domestic = Low margin zone, but higher growth potential.
📈 Growth Outlook
🧭 The good:
- Wagon depreciation adjusted from 15 yrs to 30 yrs → EPS boost via reduced expense.
- ₹370 Cr LLF provisioned smartly using internal estimates (so far).
💣 The risky:
- Railways can anytime revise LLF upward, making profits vanish overnight.
- Asset-heavy business. Free cash flow always under strain.
- Domestic margins are thinner than Air India’s coffee.
🧠 EduInvesting Take
So here’s the honest truth:
CONCOR is the Rahul Dravid of PSU logistics — steady, consistent, but won’t give you sixes like Zomato or Nykaa.
It’s doling out:
✅ Healthy dividends
✅ Bonus shares
✅ Stable profits
But…
❌ CMP is already bloated
❌ No ROU = Accounting laxity
❌ Railways policy = constant risk
❌ Receivables + auditor red flags = caution
So unless you’re in for steady PSU returns + dividend plays, this may not be your “next multibagger”.
🧨 Risks & Red Flags
- Land cost escalation due to Railways policy change
- Lack of Independent Directors for 5 months (Nov–Mar)
- Trade receivables stuck without recovery
- Asset-light private competitors scaling up faster
- ₹900 Cr+ cash used in CAPEX; returns not yet visible
🧳 Final Verdict
“PSU lovers may find it a value buy, but growth hunters will probably prefer Delhivery or Blue Dart.”
CONCOR might be giving you free shares and money, but don’t forget to audit the auditor’s worries before jumping in.
Author: Prashant Marathe
Date: May 22, 2025
Tags: CONCOR, PSU Stocks, Bonus Issue, Dividend Stocks, FY25 Results, Indian Logistics, EduInvesting, CONCOR Valuation
