CRISIL’s rating on Transpole Logistics Pvt Ltd’s (Transpole’s) bank facility continues to reflect Transpole’s healthy operating capabilities, the benefits the company derives from its promoters’ extensive experience in the freight forwarding services industry and its strong relationships with its customers. These rating strengths are partially offset by Transpole’s exposure to risks relating to intense competition in the highly fragmented logistics industry, its small scale of operations, and its below-average financial risk profile marked by high gearing and low net worth.

Outlook: Stable
CRISIL believes that Transpole will maintain a stable business risk profile over the medium term, on the back of established relationships with clients and carriers and healthy operating profitability. The outlook may be revised to ‘Positive’ if Transpole’s capital structure and operating profitability improve significantly. Conversely, the outlook may be revised to ‘Negative’ if the current profitability levels are not sustained, or if there is further delay in the company’s debtor realisation, resulting in Transpole’s liquidity remaining stretched.

About the Company
Set up in 2004, Transpole provides container freight forwarding services for door-to-door, door-to-port, port-to-door, and port-to-port segments. Transpole was promoted by Mr. Vivek Shukla, Mr. Anant Choudhary, Mr. Rajeev Kathuria, and Mr. Pravin Chand Rai, all of whom have extensive experience in the logistics sector. Transpole focuses mainly on sea and air freight services. It has also begun to offer warehousing services from 2008-09 (refers to financial year, April 1 to March 31) by leasing three warehouses in Maharashtra and Uttarakhand. The company caters to corporate clients and has tie-ups with various airlines and shipping lines. It has a network of ten branches in India and 56 agents across the world.

Transpole reported a profit after tax (PAT) of Rs.15.9 million on net sales of Rs.827.2 million for 2008-09, against a PAT of Rs.12.5 million on net sales of Rs.546.2 million for 2007-08.