Note: This is a preliminary transcript and may contain inaccuracies. It will be updated with a final, fully-reviewed version soon.
Western Carriers (India) Ltd (NSE: WCIL) Q4 2026 Earnings Call dated May. 18, 2026
Corporate Participants:
Kanishka Sethia — Whole-time Director and Chief Executive Officer
Analysts:
Nidhi Vijay Vargaya — Analyst
Unidentified Participant
Pinaki Banerjee — Analyst
Vivek Gupta — Analyst
Kaustav Bubna — Analyst
Priyanka Nagalia — Analyst
Presentation:
Operator
Good afternoon and welcome to the Western Carriers India Limited Q4FY26 earnings conference call hosted by MUFG. As a reminder, all participant lines will remain in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal the operator by pressing Star then zero on your touchstone telephone. Please note that this conference is being recorded. I will now hand the conference over to Ms.
Nidhi Vijay Vargaya from MUFG for opening remarks. Thank you. And over to you.
Nidhi Vijay Vargaya — Analyst
Thank you. Good afternoon everyone. I welcome you all to the Q4 and full year FY26 earnings conference call for Western Carriers India Limited to discuss the business performance we have from the management, Mr. Kanish Kaseria, CEO, CFO and Whole Time Director. Before we proceed with the call, I would like to mention that some of the statements made in today’s call may be forward looking in nature and may involve risks and uncertainty. For more details, kindly refer to the investor presentation and other filings that can be found on the company’s website and on the stock exchanges.
Without further ado, I would like to hand over the call to the management for their opening remarks and then we can open the floor for Q and A. Thank you. And over to you sir.
Kanishka Sethia — Whole-time Director and Chief Executive Officer
Thank you. Nidhi, thank you so much for your kind introduction. I hope I’m audible to everyone.
Operator
Yes sir. Please go ahead.
Kanishka Sethia — Whole-time Director and Chief Executive Officer
Thank you. So good afternoon everyone and welcome to the Q4 and full year FY26 earnings call of Western Carriers India Limited. I’m joined today by my excellent colleagues Ashish, Sapna, Jitender and Surya. Thank you for taking the time out to join the call and for your continued engagement with us. Let me start with the broader macro environment and discuss its relevance to our company side by side as we go along. As you will appreciate and agree, we are in the middle of the Middle east crisis with daily changing news cycles and no exact end or solution in sight.
Subsequently, over the last quarter the global outlook has weakened. The International Monetary Fund IMF in its April 26 World Economic Outlook titled Global Economy in the Shadow of War has revised global growth down to 3.1% and 3.2%. So it’s looking a bit bleak versus earlier expectations of around 3.3%. The IMF and World bank attribute a meaningful part of this change to the Middle east conflict. Obviously that began on 28 February and the disruptions ensuing around the state of Hormuz. Because of this, the IMF expects global headline inflation to rise to about 4.4% before easing again.
Advanced economies are projected to grow between 1.5% to 2% range and emerging markets has also seen a reduction projection to 3.9 from 4.2% with the January projection. The Financial Stability Board has flagged increased financial instability risks including market volatility and higher financial conditions. In the IMF adverse scenario global growth slips to 2.5% with inflation of around 5.5.4% and in severe scenario growth is only at 2% with inflation above 6%. So overall the near term operating environment remains extremely fragile and sensitive to further escalation.
Moving to India India’s growth expectation remains higher than many other major economies and remains the one true bright spot and beacon of hope in the global economy even though the outlook is not without risks particularly from energy prices and global trade conditions. The IMF has revised India’s FY27 GDP projections upwards to 6.5 citing carryover from FY26 and changes in tariff conditions. The Reserve bank of India’s latest projection is 6.9% for FY27, both of which augurs really well for us.
Other domestic agencies are also in a similar range with variations depending on crude assumptions and the impact of West Asia developments on inflation CPI inflation for April 26 was 3.48% provisional compared to 3.4 in March 2026, marking multiple months below the RBI’s 4% target. However, agencies including Crystal note that if Brent crude remains elevated in the USD 90 to 95 range, inflation should move higher over FY25. The RBI has retained its inflation target framework 4% with a 2 to 6% band for April to March 2031.
On the fiscal and revenue side, gross GST collections for April 26 was reported at 2.42,000 crores up 8.7% year on year. Now coming specifically to the logistics industry, the sector continues to evolve towards an integrated, complex, cross border coordination and technology enabled execution scenario. At the same time this quarter has shown that geopolitical shocks can quickly disrupt flows, raise costs and reduce capacity availability. Industry estimates, including research Nestor placed the global FOPL market at around 75 to $80 billion in 2026 with projected growth over the long term.
In India, IBEF and other sources estimate a large and expanding logistics market supported by infra build out and policy initiatives. However, execution constraints, cost inflation and volatility in EXIM lanes remains a near term reality. Government programs such as the National Logistics Policy, the PM Gati Shakti and the platform initiatives aimed at visibility and integration are ongoing and showing extreme positive results on the ground. The midterm intent is to improve efficiency and model mix, including increased rail share in freight and reduce overall logistics costs to bring it in line with the most developed economies of the world.
Now, turning specifically to the geopolitical situation which has been a defining variable for our industry and our company in this quarter, as everyone knows, the state Hormuz has been completely blocked since 28 February, thereby disrupting global supply chains which were already very fragile after the Israel, Palestinian and the Russian Ukraine crisis. To put it in perspective, the pre conflict Traffic averaged around 3,000 vessels per month, which is down to around 5% of pre war levels. Now for the Western trade, obviously the effect on trade and commerce has been huge and I would like to address this in some detail now.
The effect on trade and commerce has been expectedly huge. India’s merchandise export have fallen 7.4% year on year in March to 38.92 billion, with shipments to West Asian region particularly down 58%, both largely driven by the Middle east crisis. Normally monthly exports to the region are around 6 billion, but this March only 2.5 billion worth of exports have gone. However, with import, particularly oil and gas also declining by 6.5% to 59.5 billion in the month, India’s overall foreign trade in goods compressed, resulting in a relatively low trade deficit of 20.7 billion.
A concerning point is that though the shipments have been tepid in recent months, to begin with, exports of goods have contracted for the first time since October 2026, a clear sign of collateral damage in large parts to the ongoing Middle east crisis. For our part, we as a large logistics service provider have been cleanly taking proactive steps from day one to limit disruption from the worsening Middle east conflict by closely tracking our shipping carriers, planning our consignments as early as possible and exploring alternate routes in conjunction with our clients.
Even as freight rates, insurance premiums and transit times rise sharply above uncertainty around the state of Hormuz, our goal through the entire crisis has been singular to ensure minimal disruption and delays to our client supply chains and ensure transparency throughout this difficult period. At the same time, our clients have also responded urgently, with most businesses adjusting inventories, contracts and delivery schedules to build in flexibility and as the conflict threatens cargo movement and supply chain.
To give a picture of the situation, as of March end around 40 to 45,000 Indian containers were standard either in transit or at international ports. And the future of export cargo worth around a billion and a half is already under cloud starting at, you know, staring at either a diversion in routes in some cases and and even a U turn to India and others, leading to unavoidable cost escalation. Of these 40405000 containers that we speak of, nearly 80% of them are already in waters in transit and standard.
Adding to this, several contingency surcharges by shipping tenors are causing an additional three to five fold increase in per container cost. In some cases. All these together are leading to cascading costs, a possible container crisis and particularly for perishable goods exporters. They may even be hefty losses due to non or delayed shipments and deliveries. For example, according to sources, a good share of these stuck consignments are basmati rice which is 4 lakh tonnes plus. Hence, just like the Israel crisis last year, the shipping lines are having to reroute consignments around the Cape of Good Hope circling Africa to avoid the state of Hormuz and the Red Sea.
These diversions obviously add almost 3,500 nautical miles to voyages, delay shipments by 10 to 15 days and significantly increase fuel and insurance expenses, making deliveries to key markets like the US and Europe more expensive and more time taking. The risk off is that these longer voyages will tighten vessels and container availability further pushing up freight in coming weeks and months should the situation not start improving shortly. Due to all of this, the capacity currently on key routes to US and Europe is about 30 35% of normal levels, putting extreme pressure on the EXIM trade.
It is to be noted that these two markets, Europe and US markets account for 195 billion of the projected 437 billion goods export in 2425. As per a report in Financial Express. This becomes all the more important as key export markets of Middle east has seen shipments almost completely. Stopping the war has resulted in insurance premium going up by US$1200 for 20 seaters and US$2400 for 40 seaters in some cases. Add to that the shipping lines imposing war risk surcharges and cargo which in many cases are nearly doubling the ocean freight costs.
Now not only the cost impact, but the crisis also has created logistical bottlenecks as carriers are having to divert vessels to safer ports or issue end of voyage notices for some services. These moves have led to cargoes being offloaded at alternative hubs leaving exporters scrambling to arrange alternative and more expensive onward transportation to end destination to their clients. Another Fallout of this, should the situation persist, is the imbalance being created by standard ships, which will reduce availability of containers at Indian ports, potentially affecting new export bookings even further.
Similarly, EXIM boxes are getting stuck at ports waiting for exports and import boxes are coming in a bunch in spurts leading to detention and damages across the boards. Stability in this region is key for competitiveness of shipments bound for Europe, Middle east and Africa, particularly as they rely on Gulf transshipment hubs. This conflict obviously impacts us as a company as well as the rest of India’s container rail logistics sector. With weaker exports to the west, there is a sharp rise in stabling or parking of brakes for want of cargo and at several instances running of empty wagons to source for lack of return of reverse direction cargo.
This obviously impacts the turnarounds, the tat, the timelines, the schedules and profitability. For instance, per industry estimates, the requirements for stabling of rakes idling for want of cargo in the month of March has already crossed 50 rakes 50 trains, which is a dramatic increase from an industry standard of 4, 5 rakes that are stable on a normal situation to deal with cargo fluctuations. So that’s a 10x empty wagon running has also seen a steep increase due to reduction in cargo volumes with an estimated 15 to 20% of wagons being moved empty, a sharp increase from the normal 5% which is usual industry practice, which is a 4x.
The import, export, EXIM volumes for the logistics industry are said to have shrunk by about 40% in the month of March with reductions and heavy fluctuations in both export and import volumes. Luckily for our company, we have been very resilient in this regard with our EXIM container movement dropping less than 11% compared to the 40% overall, there is a slight dip in the EXIM lead by 2% due to lesser demand in North India, but container detention and damage remains an issue with the rescheduling and rerouting of of the global ships.
But I will discuss the container numbers a bit later in greater detail as we go along. Let me talk after the EXIM about the domestic transport where the domestic transport volumes, especially in the tiles and steel industry with heavy reliance on imports of raw materials, have seen drops. These two industries directly affect our MMLP operations in Morbius, which is located at the heart of the tiles industry as well as caters to a sizable portion of steel business from West India. Despite this, by pivoting to the industries like industrial chemicals, FMCG, aggregates etc.
Your company has managed to keep its domestic volume steady with a minimal decline of less than 1% quarter on quarter. Your company has shown remarkable resilience despite these trying conditions and a tough year, and grown overall 6% in container movement year on year. More on this later when we delve into the container numbers in detail shortly. From our side Like I previously mentioned, the operating response has focused on extreme execution discipline under very constrained conditions, closer monitoring of carrier schedules, earlier planning wherever possible, alternate routing evaluation and contract and delivery schedule adjustment in real time in coordination with our customers.
In an extremely difficult global geopolitical situation like this, the priority for us has been continuity of service, extreme cost control, resource optimization and risk management. Let me briefly cover our multimodal cargo terminal at Devalya which I earlier mentioned near Murbi for the ones listening to us for the first time. The facility is spread over 32 acres and services industries in the Murbi cluster including tiles, chemicals, ceramics, agri and food grade products. Our MMCT is at the literal heart of the tiles industry which accounts for 80 to 90% of India’s ceramic production and so obviously draws a large clientele from them.
Naturally, in the current environment, tiles industry is staring at an unprecedented fuel crisis triggered by the conflict. 700 units are facing propane and natural gas supply shortages. As most of you know, almost 70% of Murbi ceramics units run on propane. SMMCT throughput of tiles has been impacted majorly for the month of March, but the terminal has supported operations through storage consolidation and the ability to adjust routing for delayed or diverted cargo and is pivoting towards other cargo, notably industrial chemicals in which we have had some success and are seeing volumes steadily go up month on month again.
Our fixed services correcting Diwaliya to North in cmlk, Bangalore and Chennai in south and Calcutta and Guwahati in east continue to regularly operate, albeit at lower frequencies. Given the demand cycle, our service offerings are expected to increase this FY across the country for the domestic cargo and expect it to penetrate new clients and new industries. Our state of the art MMCT gives us a lot of scope on growing our businesses from Western India which fits extremely well with our long term vision.
Now looking at the global scenario, some prompt and much needed relief has been provided by the government agencies in these tough geopolitical situation and I would miss in my duties if I didn’t briefly touch upon this GOI has launched 1.5 billion Bharat Maritime Insurance Pool to shield shipping from global risks. BMIP will provide coverage across key segments of maritime risks including hull and machinery, cargo protection and indemnity, P and I and war related risk for Indian flag vessels and those with India linkages.
BMIP is intended to reduce India’s reliance on overseas reinsurance market which will lead to great financial resilience and autonomy in a sector that carries 90% of India’s trade by volume. Customs has also jumped in and permitted return of exports back to origin under a back to town circular wherever required. The DG of Maritime Administration has issued a notice to shipping lines to maintain transparency and avoid any type of predatory pricing for cargo owners. The Johannal Nehru Port Authority has issued a circular ordering 100% waiver on ground rent and 80% relief on reefer plug in cost.
While on the subject of gnpp, I also want to note an important infrastructural milestone. On 31 March 26, DSCCIL announced the completion and commissioning of the Western Dedicated Freight corridor including the final 102km which were pending from JNPT to New Rafale stretch. This is expected to give us a very big boost to EXIM trade going forward for our business corridor. Availability is relevant to long term customer movements including mandates previously disclosed such as the Vedanta work order and the Jindal Stainless Steel engagement and the use of specialized assets deployed during the year.
Both the Western and Eastern State corridor is a wonderful opportunity for your company to deepen relationship with existing customers as well as grow our client pool on which your company remains deeply focused. I would like to get into the numbers in detail before opening the floor for Q and A first coming to container volumes for this quarter and this financial year. So the comparative numbers quarter to quarter quarter 42526 and comparing to quarter 42425 the domestic numbers have increased to 23,350 from 19,824, an absolute increase of 3526 containers percentage wise 17.79% and EXIM numbers are 34,404 compared to 35,532, an absolute reduction of 1128 containers and a dip of 3.17% overall for the quarter.
If we see Our numbers are 57,754 containers compared to 55356 containers in Q4 of last year, which is an absolute increase of 2398 containers and 4.3% increase. But if we compare it to our Q3 numbers, the 34,404 EXIM numbers are compared to the 38,638 containers in Q3 of this year which shows a reduction of 4234 containers, an absolute reduction of 10.96%. Fortunately in domestic like I mentioned, we’ve been able to retain by pivoting to other industries. So our numbers are 23,350 compared to 23, 565, an absolute decrease of just 215 containers which is less than 1%.
In fact what is pertinent here is that the total numbers for Q4 is 57,754 containers compared to 62,203 in quarter three which is a 7% reduction. In fact EXIM volumes had gone up 14% in quarter three and we were on a strong growth rail till the latest crisis cropped up mostly in the month of March this number has come down. Similarly domestic was up 15% in quarter three but almost same due to lower demand but due to production issues in key clusters. As discussed, our strong pivot has helped us ensure that we’ve not seen any decline in our domestic numbers which is speaks to the tough work my team has done.
Now if we look at holistically for the whole year, I’m happy to announce that our numbers have gone up more than 6%. For the whole year our domestic numbers are 86,353 compared to 79,840, an absolute increase of 6,513 containers and a percentage increase of 8.16. Similarly remarkably our EXIM numbers have also gone up to 1,40,225 compared to 1,635 last year, an absolute increase of 6,519 and a percentage increase of almost 5%. In overall numbers, 2,26,578 boxes compared to 2,13,475 the year before, an absolute increase of 13,103 containers and a percentage increase of 6.14.
I would like to point out that this would have been double digit volume growth but for the month of March which again is cetrisparious global geopolitical situation which is well outside our control. We are already seeing very good demand in domestic stream for our specialized containers. Your company produced 161 procured 161 specialized containers during FY26 and we have similar orders in pipelines for FY27 as well. I’ll talk about Capex a bit later. Now coming to the financials for Q4 and FY26 revenues from operations was INR 496 crores, climbing steadily further up by about 4% from 478 crores in Q3 recording a fourth straight growth quarter on quarter.
This shows the company’s resilience even in the toughest of geopolitical situations well beyond our control. However, due to the current situation as discussed above, there was a small drip in profitability wherein EBITDA decreased from 27 to 25 crores and EBITDA margins showed a slight decline from 5.6 to 5%. Similarly, the PAT decreased slightly from 10.8 crores in Q3 to 8.3 crores in Q4 and the margin decline was minimal from 2.3 to 1.7. We are seeing a lot of demand and hence a major capex was planned and done in the last financial year.
Total capex deployed in FY26 was over 70 crores including in specialized EU’s handling equipment such as REIT stackers, commercial vehicles, all completely aligned to our customers requirements and operating needs. Our own fleet of specialized containers now stands at over 1000 making it one of the largest specialized container fleets in the country. In the private sector seeing better opportunities, our intention is a further capex of 100 crores in this FY27 which remains linked to strong customer demand and will be calibrated to market conditions as year goes on including the pace of EXIM normalization.
All capex is always driven by long term commitments with larger customers as discussed in earlier calls and we do not build before we have orders on working capital intensity has increased alongside scale, scale and operating cycles in this segment. The timing of operating cash flow improvements will depend on realizations, collecting cycles and pace of volume recovery particularly in the EXIM linked activity to close FY26 ended with a challenging Q4 driven by external disruptions, but your company managed not only to survive but thrive delivering customer trust and expectations to the T.
Your company has a very strong order book with pedigreed customers for the rest of the year giving us additional confidence. Realizations which have been impacted due to geopolitical reasons is also expected to improve as we grow back our ex IM business in the coming months and quarters, particularly backed by a strong ex IM business from the east coast ports. Our emphasis as always remains on execution, risk management and maintaining customer service levels through uncertainty. We feel extremely happy at the efforts put in by our team during these tough geopolitical situations which remains out of our controls and we feel extremely confident about our prospect going forward in the near future.
We feel we are poised for greater trajectories ahead as the situation starts normalizing in conclusion, thank you again for taking your time out on a Monday morning and joining our call. For which I am eternally grateful. We will now open the floor for Q and A.
Questions and Answers:
Operator
Thank you. Ladies and gentlemen, we will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on the Touchstone telephone. If you wish to remove yourself from the question queue, you may Press Star and 2. Participants are requested to use their handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles.
Unidentified Participant
Ladies and gentlemen, a reminder. If you wish to ask a question, please press star and one.
Operator
We take the first question from the line of Pinaki Banerjee from AUM Capital Private Limited. Please go ahead.
Pinaki Banerjee
Good afternoon, sir. Thanks for the opportunity. Sir, my first question is when you conducted the IPO, I think you raised net proceeds of about rupees 363 crores. For which you think you have spent about 163 crores for debt repayment. Sir. But in comparing from FY25, 2026 your debt has gone up to 1 from 172 to 217 crores. So sir, can you please explain this?
Kanishka Sethia
Thank you for your question. The working capital requirements has been constantly going up as we operationalized our new multimodal cargo terminal.
Pinaki Banerjee
And so
Kanishka Sethia
Working capital requirements we have taken has gone into our working capital requirements, sir.
Pinaki Banerjee
Okay. Sir, can you just give a breakup between of your revenue between railroad and water transportation.
Kanishka Sethia
Sir, we do not salami slice our revenues per se. Since we are a supply chain company
Vivek Gupta
Dealing
Kanishka Sethia
And you know end to end logistics. We do not salami slice our numbers. Because then if we do that the real picture will not come. For example, sometimes if we are moving say 2800 tons by rake and there is a spillover of 100 tons, that hundred tons will go by road. But if you look at the it’s all actually multimodal and whatever road with was what was left out. So if I segregate that as 20 hundred, 28 hundred tons multimode and 100 tons in road, you know the numbers will not actually be correct. Hence we do not salami slice our numbers.
We look at ourselves as a consolidated logistics supply supplier.
Pinaki Banerjee
Okay, so and last question, update on that mmct. How is it progressing?
Kanishka Sethia
So we are fully operational now, sir. And you know the Devalya MMCT is right outside Murby. Sir, we are smack in the middle of the tiles industry. And the tiles is a natural customer for us. Unfortunately it’s tiles industry is quite badly impacted by the lack of supply thereof of propane. But the situation, it improves. We will see our tiles volume dramatically pick up from there. In the meantime, we have pivoted to our other customers and other sectors including industrial chemicals, salts, FMCG, etc.
To you know, operations run. The volumes are lower than what it would have been had the tiles industry been there. Obviously that’s the answer for us. And we hope that, you know, sooner than later the tiles and the steel manufacturing activities there will go back to normal. Okay.
Pinaki Banerjee
Okay, so that’s all for my end and thanks and all the rest of the future.
Kanishka Sethia
Thank you, sir. Thank you for your question.
Operator
Thank you. We take the next question from the line of Vivek Gupta from Star Group. Please go ahead.
Vivek Gupta
Yeah, thank you, sir. Given the structural tailwinds such as the dedicated freight corridor, the trade normalization and supply chain formalization alongside the near term geopolitical risk, like potential disruption in the state of formulas, how should investor think about your steady state business for the next two to three years in terms of growth, margins and cash flow generation?
Kanishka Sethia
Excellent question, sir. I feel, and you know, maybe I’m harping on my own tune, but I feel that we are very, very strongly poised even in these extremely tough situations. We went through the Russia Ukraine crisis, followed by the Israel Palestine crisis, and now we find ourselves in the Iran crisis. Despite all of this, your company has been resilient, your company has been growing and we are poised for a major jump once situation starts normalizing not only in terms of a top line, but also a greater and major improvement in the bottom line as well.
We’ve been quite constrained by these tough geopolitical situations. For example, I was talking, let me give you guys an idea. The numbers, if you are tracking us quarter three, you know, I was extremely robust. And in quarter three we had delivered almost a 14% increase in EXIM numbers after a long time. And we were very hopeful that, you know, the trend is going to continue. We had delivered similarly 15% growth in our domestic numbers, so looking very, very good and positive in our business scenario.
And January also was a stellar month for us. February was extremely good. And then for 28th of February, this whole situation exploded, which led to a major reduction in both the domestic as well as EXIM volumes, especially on the West Coast. So what it did was it eroded a lot of good work that we had done for the rest of the year. Despite that, despite taking an 11% hit on our EXIM numbers compared to a 40% hit that the industry has taken and taking a hit of almost close to 4,500 containers in the quarter quarter four compared to quarter three.
We still managed to finish the year on a robust 6% positive number for containers, which shows the strength with which we operate. And we feel that sooner than later these, these situations have to sort of settle down. It’s in the interest of the entire world. And when we do, I think we are poised for a quantum leap. Sir, I strongly feel that the rest of the decade belongs to the logistics industry. And I think we are primed and in a prime position to actually get a large chunk of benefit out of that.
So that’s what I would suggest. That’s what I would say that we feel that we are in a very good position to actually have stellar growth. I don’t believe in giving future projections or future numbers, but I feel very, very confident that we’ll be able to perform extremely well despite the situation that we are in. Sir, we grew quarter to quarter every quarter despite the situation. And we are looking at doing the same in this quarter and going forward as well. Sir, the order books remain very strong.
The domestic pipelines are good and the exim pipelines, especially on the east coast, are very robust. We’ve been able to increase our business on the east coast and we look forward to growing our businesses both in ex im as well as domestic in this quarter and going forward as well.
Vivek Gupta
Okay, okay, sir. Sir, in periods of stress, do customers prioritize cost efficiency or integrated reliability? Like. And where do we position ourselves in this spectrum?
Kanishka Sethia
That’s a very pertinent question, sir. I think in, in, in supply chain, especially multimode, you always have to be cost effective. But at the same time, depending on the level of service that you can provide, I don’t think the cost remains the only factor for our large customers to decide on. Multimodal complex supply chain, it’s sort of different from plain road transport in the sense that you bring in a lot of optimization efficiencies and cost benefits overall. So the idea is the customer and the especially the bigger customers always look at a mix of both economics as well as efficiency.
That’s what my gut feel is, sir.
Vivek Gupta
Okay, okay. So how do margins differ between the domestic and exim segments? And what would be the impact on overall profitability from a shift in business mix?
Kanishka Sethia
So the margins actually they don’t. They again, not salami slice like this. Some domestic businesses are extremely profitable. Some exim businesses are extremely profitable, vice versa. Some domestic are not so profitable. So it’s Hard to really say what are the margins in you know, domestic movements compared to exit. But overall the idea is that we try to do business only profitably. We don’t do business just the top line is for sure. So we don’t try to push only the top line. We only try to do businesses which we can do profitably provided that we add value to our customers.
So our first port of call always remains that we must be adding significant value to our customers supply chain. If you are not adding value to our customers supply chain we do not try to get that business. If I am going to try to do the same thing that others are already doing and it is only an incremental benefit to my customer, I do not look at those businesses at all sir. So the idea is to make my customers supply chains more robust and profitable and at the same time do the business profitably.
We do not believe in doing the business for the sake of doing in business.
Vivek Gupta
Okay sir, thank you. That really helps and all the best.
Kanishka Sethia
Thank you sir. Thank you for your questions.
Operator
Thank you. We take the next question from the line of cost of Babna from bmspl. Please go ahead.
Kaustav Bubna
Hi Kanesh Kavio.
Kanishka Sethia
How are you?
Kaustav Bubna
I’m doing good. I’m doing good. Just wanted to get some more clarity. You know I speak openly about your incrementally rising receivables over a long period of time now. So even though the industry is going through a bad time, we all understand that. You know from a layman’s perspective I’d like to understand why aren’t you being able to collect the money from your from the end parties that you are already engaged in business with. So you know who are these end parties who owe 600 plus crore in receivables?
Is there any way you could break it down to whatever extent you’re willing to?
Kanishka Sethia
Good question Kaustav. Actually this is something that we as an industry have been all struggling with. Maybe us slightly more than others. But our debtor days has definitely not been coming to the target that we would like. We are targeting to bring our debtor days to below 120 in this current financial. What has happened is that we have seen a lot of demand and a lot of new customers have been added. Especially MMCT which are retail customer. That’s a business which we started only this financial and so it is taking time for us to actually absorb that into our books and start getting the payment cycle.
A lot of it is new business that we have done, new cycles that we’ve Started new areas of businesses that we’ve done. So we started with the west coast to the east coast, then we started services to North India, to cmlk which is outside Delhi and then to South India which is Bangalore and Chennai. So since our service offerings have gone up, also our receivables have gone up. We expect to start seeing that stabilizing post this current geopolitical crisis because the more the material we can send, the more the cycle will start reducing.
Right now, since there’s not dispatches, you know, the funds are getting stuck up from the clients who are waiting for the next lot before releasing the payments. As is the want in retail side of the business. So since we’ve grown our retail side of the business from corporate in the last two years almost, I would say 25, 30% year on year. So the funds have gotten stuck up. But we have internally kept a target of trying to bring debtors down to about 120 days in this financial
Kaustav Bubna
Also added to that I wanted to understand. See in just take FY25 and FY26 in question, your operating cash flow has been negative in both these years. Right now you had some cash in your balance sheet which is also, I mean almost fully used. Almost fully used. And your working capital debt is increasing while you have negative operating cash flow. And while FY27 also seems to be a bleak year because of all the external issues going on. Right. Which is not in your mind control. And we don’t know when the situation will end, although hoping it will end sooner rather than later.
So I mean, I find this concerning also, you know, given that we are, you were saying you’re targeting 100 crores plus capex this year. So keeping in mind, you know, negative cash flow, 100 crores capex, rising debt, lesser cash. I mean how can, can you help me understand how concerned are you about the situation and why. So I mean if you could give some logic on your concern.
Kanishka Sethia
Yeah. So Costa, we have actually from our IPO funds just under a hundred crore still with us to be deployed. Our plan was always to deploy our IPO funds, you know what came into the company over three years. So we’ve actually deployed more or less in cycle. With that we reduced our CapEx from the planned 100 crores last year to about 74 odd crores this year. Seeing the variation in the EXIM, we use the CapEx mostly for domestic. And this year also the exit that we planned is 100 crores of which we have 92 from our IPO fund still to be deployed.
So that’s not of immediate concern for us. The cash flow remains negative like I said, due to the increasing working capital requirements. But we expect it to improve as realization increases, especially on our exim side. So that is something that we are very hopeful will start reflecting from this year. We’ve pivoted on our exim side more to our east coast exports to sort of buffer the hits that are happening on the west. That’s something that we cannot control but obviously that’s a highly profitable business that we can’t do.
We are a derived industry cost of. So only if my principals are able to export to the west coast and to west, that is Europe and us can we see that improving in my gut feel is that the situation, especially in the exim side should start improving or rationalizing itself within this quarter. We had the Iraq, you know, the Russia crisis, followed by the Iran Palestine crisis. But they all, even before they were resolved the situation had started working itself through the system, maybe through the longer transits through the Cape of Good Hope, the longer transits of 3,500 nautical miles.
So all of that basically figures in into the market because you know, the work goes on, life goes on. All of that gets factored in. This has just happened in the month of March, we are two months into it. But I’m hopeful that from this month onwards we’ll be able to see, you know, green shoots of recovery even in the EXIM trade on the western seacoast. Our numbers, you know, not really looked at it in much detail but our numbers for the initial part of this quarter is looking very robust and I’m fairly confident that we should be able to see, you know, realizations also improve and working capital cycles also improve from this year on.
Operator
Thank you. Due to time constraint we take the next question from the line of Disha from Sofia Capital, please go ahead.
Unidentified Participant
Hello sir.
Operator
Yes Disha, please go ahead.
Unidentified Participant
Yes. So my first question is again on our EBITDA margins we’ve seen a decline given the geopolitical situation, what sort of how do you look? So I understand for you it’ll be difficult to give a proper range or something but what sort of further pressures are we seeing on EBITDA margins given the price impacts start flowing, have started coming in from April onwards. Any kind?
Kanishka Sethia
Yeah, Disha, though I don’t want to make any forward looking kind of statement but I feel that you know, from here our EBITDA margin should sequentially keep improving because we’ve seen you know, three wars back to back in the last year and a half. And so these have been really tough times for, you know, EXIM trade. We used to draw substantially large part of our balance sheet from the exempt rate, which we’ve now pivoted hard into domestic in the last year, year and a half. But it still plays a very large part of our business cycle, despite the amount of, you know, change that we’ve done.
To give you an idea, our FY26 numbers is 141.4 lakh containers in domestic in EXIM compared to 87,000 in domestic. We are now seeing our domestic go up year and year and increasing our footprint in the domestic side more. But the existence trades remains a very large part of our business even now. And we are very hopeful that from here we should be in a position to actually improve. We’ve had three global wars in the last, I would say, what, one and a half years or so, and that really affects global exempt trade and it affects disha.
What I really want my listeners to understand is that I’m a derived industry. If, if my principals are able to export more, my business sequentially goes up. You know, I have large contracts with marquee customers. If they’re not in a position to export, for example, if they’re not in a position to manufacture because they don’t have raw materials like propane and gas, there’s not much a derived industry can do. So I think this is a bit of a tough call for the industry in entirety. But I feel that where we are now from here, we can only continuously improve.
I do not foresee it not improving. Going
Unidentified Participant
Further down. Yeah, going further down. You don’t.
Kanishka Sethia
I see it improving dramatically from this quarter itself, actually, because we have done whatever needed to do to pivot more into domestic and to ensure that our empty haulages is reduced, our linkages are made stronger, whatever reverse logistics we needed to do, we have done all of that planning. We worked round the clock, I would say, for the last almost five to six weeks as a team, as a company. And we are seeing, you know, a very steady kind of situation now. I don’t think we are much in a crisis mode now.
And I think we are in a cusp of some really good things. I don’t want to give future projections, but I feel confidence that from here both the top and the bottom line should start showing a sequential improvement.
Unidentified Participant
Okay, fair enough, sir. And so, just to follow up on that, so you, in terms of a domestic volume, what do you see as the key growth drivers for driving this domestic market share for us. And in terms of capex you mentioned we’re planning 100cr capex. Could you elaborate a bit more on where are you planning this amount?
Kanishka Sethia
That’s a very nice question Disha. So basically these though you know our name is Western carriers, we do not or we have not historically drawn a lot of business from the western side as much as we do from the east and south. So our focus has been on growing our western trade, you know, which aligns very well with the reason why our first multimodal logistics park we set up in Murbi. We dominate the retail part of the rail business on the Sarastra side and that’s why we came up with this, our own multimodal logistics part there and it’s fully up and running.
I feel that once and the locational advantage that we have Disha is that we are smack in the middle of the tiles industry. It’s tiles industry central. We are smack there. You don’t have to travel even a mile to get to our customers. It gives us the benefit of proximity which brings down the first mile cost for our customers which makes us profitable. So once the volumes of tiles, which is now almost zero in the month of March starts improving with propane supplies, I think the domestic play is going to rotate largely around our multimodal cargo park as well as our other clients that we are working with on the western sea coast.
The volumes have been subdued but we expect it to start rising from this month onwards.
Unidentified Participant
And just on the capex amount, where exactly will we be utilizing that?
Kanishka Sethia
So the capex is going to be again a mix of specialized containers, commercial vehicles, heavy equipment, etc. For example, we did 161 containers specialized. These are all, you know, build to suit kind of containers. These are not your standard shipping line containers. We have an order of almost the same size under production right now, which comes into, which comes into operations from the end of this month and beginning of next month, over the next one one and a half quarters. So that’s where it is going.
We have some capex planned for replenishment of our commercial vehicle fleet. We try to keep our fleet up and tidy and so we have a requirement of replenishment of our fleet on a Pan India basis as well as we have some equipment requirements in terms of fleet stackers, industrial size forklifts, large size cranes, et cetera. So these are all assets and equipment that we to deploy in our businesses and which are not very standard. These are very specialized to our needs and that’s where most of the bulk of the apex is going to go.
Unidentified Participant
Okay, that is it from my side. All the best. Thank you.
Kanishka Sethia
Thank you. Disha, thank you for your questions. Please.
Operator
Thank you. We take the next question from the line of Priyanka Nagalia from Aditya Billa Sun Life Insurance. Please go ahead.
Priyanka Nagalia
Hello. Yeah, so this is regarding your margins and your RoC and RoE profiles. The last two years we’ve seen a significant decline. From FY24 we were at 8.7%, kind of an EBITDA margin which FY26 we have ended at 4.6%. The RoE in RoCE which was about 20% has now come down to single digit. So how do we see the next two years from here?
Kanishka Sethia
Fair question, Priyanka. Like I was saying, we expect these numbers to actually more than the top line. We see our bottom line seeing a large improvement. The EBITDA margins which are 4.6, 4.7. We hope to bring it back to where we were starting at 525 which is around almost 7% and even higher a year earlier. These were the times when, you know, the supply chains were running very robustly. We didn’t have any empty haulages, detention damages. Those sort of unplanned kind of hits which have happened to the supply chain is mostly I feel to the geopolitical situation one after the other, starting with Russia, then to Israel and now to the Middle East.
So it’s been like never ending stream of bad news for global shipping. But I don’t think hopefully we are at the end of this and we should be able to see the improvement in the EBITDA numbers. And similarly we should see the roes and rocs go back to where they were in strong double digit numbers. The debt numbers are obviously quite under control and we’ve been now working on improving the ROE, the ROCs back to where they were and take it back to the EBITDA margin numbers as well. So overall percentage increase as well as the quantum increase is what I expect this year in a very strong way.
Priyanka Nagalia
So will any guidance on what can be the increase this year and next year in terms of margin expansion?
Kanishka Sethia
Don’t want to give any future forward guidance, Priyanka, but I feel very extremely confident in my bones that both the top line and bottom line are headed in the right direction. Especially the bottom line. I’m looking at it being very robust because like I said in the last six weeks or so we burned the midnight oil in making our supply chains as lean as possible. The devil is in the detail. And we’ve gone down as granular as we can be to ensure that we make our supply chains as lean as we can.
And I think the results are showing. I’m quite comfortable with where we are in the month of May. About another month and a half to go in this quarter and it’s looking quite, quite comfortable. I see my top lines are extremely better than what it was last quarter, last year on year. And I see my bottom line hopefully will also be in a position to recuperate from where we are. Like I said, Priyanka, I think we hit the rock bottom. And from here, bottom line wise, we should start seeing an incremental improvement now.
Priyanka Nagalia
Okay, thank you.
Kanishka Sethia
Thank you, Priyanka.
Operator
Thank you. Ladies and gentlemen, with conclude the question and answer session. I now hand the conference over to Ms. Nidhi Vijay Vargya from MUFG for closing comments.
Nidhi Vijay Vargaya
I would like to thank the management for taking the time out and to all the participants for their questions. If you have any further queries, feel free to contact us. We are MUFJ Intime Investor Relations Advisors to Western Carriers India Limited. Thank you.
Operator
Thank you on behalf of Western Carriers India Limited. That concludes this conference call. Thank you for joining us. And you may now disconnect your lines.