Snowman Logistics targets revenue of ₹1,000 crore by FY26

In an interaction with CNBC-TV18, Sunil Nair, CEO & Whole-Time Director highlighted that the company changed the business model a year ago bringing in Fifth-Party Logistics (5PL) services. Under this model, the company owns inventory. "So, we see that margin in terms of percentage may start dropping because of the blend, but overall, that is going to contribute much more with least investment because there we invest only in the working capital of inventory holding so the returns are much better. So, we have an ambition to reach close to ₹800 crore to ₹1,000 crore by FY26." 

Snowman delivered steady performance in the third quarter (Q3FY24), despite it being a seasonally slow period with general softness across all segments.

The company provides temperature controlled logistics services for dairy, fruits and vegetables, poultry and meat, sea food and pharmaceutical products.

Revenue for the quarter was at ₹124 crore, up 13% from the year-ago period. The earnings before interest, tax, depreciation, and amortisation (EBITDA) rose 9% to ₹27.50 crore, while the profit after tax (PAT) rose 14% to ₹4.25 crore.

For the nine-month period ended December 2023, the company posted a revenue of ₹376.83 crore, a 23% increase compared to the previous year. The EBITDA also increased by 11% to ₹78.46 crore, while PAT rose 27% to ₹10.56 crore.

Nair said the extended winter this year had a slight impact on the ice cream industry. Volumes, which usually start picking up by mid-February, are extended to beginning of March. "But we believe that it will make up with the growth that it has already achieved over last year. So, we are still ambitious about doing better than Q3 in Q4, as in every yea r, because other segments like QSR and seafood are showing a better trend,” he said. Nair expects to end the current financial year (FY24) with revenue of over ₹500 crore.

Nair is not worried about the increasing competition. He sees no direct competition as of now as there is so far no national player with presence in 19 cities in which Snowman operates. "We offer a completely different value proposition to our customers; scalability or reach to the country is much quicker when someone partners with us," he said.

The company's stock has gained more than 92% over the past year.