CARE Ratings Limited has reaffirmed the credit ratings for Allcargo Logistics Limited’s bank facilities on March 23, 2026. The Long Term Bank Facilities of ₹33.00 crore are Assigned a rating of CARE A-; Stable. Additionally, the Long Term / Short Term Bank Facilities, enhanced to ₹260.00 crore (from ₹255.00 crore), have been Reaffirmed as CARE A-; Stable / CARE A2. The outlook remains Stable, supported by strong pan-India presence and promoter support.
Credit Rating Update for Allcargo Logistics
On March 23, 2026, CARE Ratings Limited (CareEdge Ratings) concluded its review of the credit profile for Allcargo Logistics Limited, resulting in the assignment and reaffirmation of ratings for its bank facilities, as per Regulation 30 disclosures.
Summary of Assigned and Reaffirmed Ratings
The following table summarizes the key rating actions taken by the agency:
- Long Term Bank Facilities (₹33.00 crore): Rating Assigned as CARE A-; Stable.
- Long Term / Short Term Bank Facilities (₹260.00 crore, Enhanced from ₹255.00 crore): Rating Reaffirmed as CARE A-; Stable / CARE A2.
The overall outlook assigned by the rating agency is Stable.
Key Rating Drivers and Rationale
The assigned ratings are primarily derived from Allcargo’s strong position in the integrated logistics sector, underpinned by its extensive pan-India network and diversified service offerings.
Key Strengths
- Integrated Platform and Consolidation: The recent consolidation of express distribution and contract logistics is expected to enhance efficiency, enable end-to-end solutions, and drive revenue growth, particularly in high-potential segments like automotive and engineering.
- Promoter Support: Strong backing from the Shetty family, who hold a 40.49% equity stake as of December 31, 2025, provides strategic flexibility and operational resilience.
- Improving Financial Metrics: Operational performance improved in FY25, with revenues rising and margins improving. The capital structure has strengthened, with overall gearing improving to 1.75x in FY25.
Key Weaknesses and Sensitivities
- Revenue Concentration: The revenue profile remains concentrated, with approximately 64% derived from the Surface Express business in FY25.
- Competitive Pressure: The express/part-truckload segment faces intense fragmentation, leading to persistent pricing pressure and compressing margins.
- Rating Sensitivity: Ratings are sensitive to the company’s ability to sustain PBILDT margins above 12% and maintain total debt/GCA below 4x (including lease liability). A PBILDT margin below 10% or gearing exceeding 2x could trigger negative action.
Financial Performance Snapshot (Post-Demerger)
Following the demerger of the international supply chain business, the company’s post-demerger financials show momentum:
| Metric (₹ crore) | FY25 (Audited) | 9MFY26 (Unaudited) |
|---|---|---|
| Total operating income | 1,961 | 1,544 |
| PBILDT* | 201 | 174 |
| Profit after tax (PAT) | 32 | 5 |
| Overall gearing (x) | 1.75 | NA |
The company’s liquidity profile is considered Adequate as of December 31, 2025, supported by cash reserves of ₹160 crore against outstanding term debt of ₹30 crore, and substantial working capital limits.
Details of Rated Facilities (Annexure-1 Summary)
The total rated facilities reviewed amount to ₹293.00 crore, detailed across two categories:
- Long Term Bank Facilities (₹33.00 crore): Comprising a Term Loan with HDFC Bank Ltd., maturing in March 2028.
- Long Term / Short Term Facilities (₹260.00 crore): Comprising fund-based and non-fund-based limits from lenders including IndusInd Bank Ltd., Bank of Bahrain and Kuwait B.S.C, Federal Bank, Axis Bank Ltd., and HDFC Bank Ltd.
This update confirms management’s trajectory post-restructuring, with the Stable Outlook reflecting expectations of sustained synergy benefits and operational improvement.
Source: BSE
