Allcargo Logistics jumbs on getting board’s approval for restructuring of businesses

Allcargo Logistics is currently trading at Rs. 305.20, up by 20.30 points or 7.13% from its previous closing of Rs. 284.90 on the BSE.

The scrip opened at Rs. 299.55 and has touched a high and low of Rs. 314.00 and Rs. 299.40 respectively. So far 369247 shares were traded on the counter.

The BSE group 'A' stock of face value Rs. 2 has touched a 52 week high of Rs. 442.40 on 20-Jan-2023 and a 52 week low of Rs. 246.00 on 26-Oct-2023.

Last one week high and low of the scrip stood at Rs. 292.00 and Rs. 268.25 respectively. The current market cap of the company is Rs. 7459.32 crore.

The promoters holding in the company stood at 69.92%, while Institutions and Non-Institutions held 13.83% and 16.25% respectively.

Allcargo Logistics and Allcargo Gati have received board’s approval for restructuring of businesses. As per the scheme, International Supply Chain (ISC) business will be demerged into a separate entity -- Allcargo ECU. This would include the India part of ISC business, along with the international subsidiaries held under the ECU Worldwide NV. The express and contract logistics businesses would come under the resulting entity -- Allcargo Logistics (post ISC demerger) -- which will benefit from combined synergies. 

Moreover, the shareholders of Allcargo and Allcargo Gati (formerly Gati) will get direct shareholding, eliminating inefficient complex corporate structure. As per the approved swap ratio, based on the recommendations of the independent valuers, shareholders of Allcargo Gati will get 63 shares in the resulting Allcargo Logistics entity (post-ISC demerger) for every 10 shares held in Allcargo Gati.

On the other hand, Allcargo shareholders will get 1:1 shares in the demerged Allcargo ECU and continue to hold their shares in Allcargo Logistics, which will now be the resulting entity holding express and contract logistics business directly. This takes into account 3:1 bonus shares approved by shareholders for Allcargo Logistics recently.

The contract logistics business brings in customer stickiness and will help amplify scale in express logistics business. The scheme is expected to be implemented in 10-12 months, accounting for regulatory filings, stock exchange approval, shareholder approval, NCLT approval and ROC filings. Allcargo group will eventually have four listed strategic business undertakings -- Allcargo ECU and Allcargo Logistics post demerger of ISC business, alongside Allcargo Terminals and TransIndia Real Estate, which were created through earlier scheme of arrangement.

Allcargo Logistics is an India-based holding Company. The company is engaged in providing integrated logistics solutions. It offers logistics services across multimodal transport operations, inland container depot, container freight station operations, contract logistics operations etc.