In This Article:
Release Date: February 11, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
-
MSTC Ltd (BOM:542597) reported an exceptional income of INR 273.54 crores due to the sale of a subsidiary.
-
The company has successfully entered into agreements for minor mineral blocks with various Indian states, indicating expansion in its mineral auction business.
-
MSTC Ltd has launched a new portal for non-performing assets (NPAs) targeting private and rural banks, expanding its e-commerce offerings.
-
The company regained a significant contract with Coal India for coal auctions, which is expected to contribute positively to future revenues.
-
MSTC Ltd has reduced its joint venture losses, indicating improved financial management in its partnerships.
Negative Points
-
Total revenue decreased from INR 316.23 crores to INR 275.47 crores, primarily due to a decline in e-commerce revenue.
-
E-commerce revenue has remained static, with limited growth expected in the short term.
-
The company faces significant competition in the e-commerce sector, with low entry barriers allowing new competitors to emerge easily.
-
MSTC Ltd lost a major NPA auction contract to public sector banks' own portals, impacting revenue.
-
The data center business is still in the development phase, with no immediate revenue impact expected.
Q & A Highlights
Q: The e-commerce revenue has been static for the last 10-12 quarters. What efforts are being made to grow this segment, and what sustainable growth rate can be expected? A: The e-commerce revenue has been static due to low entry barriers in the sector. MSTC is focusing on educating clients about its unique value proposition. New initiatives include onboarding startups and developing new business models. A sustainable growth rate of 8-10% is expected, though exponential growth is unlikely in the short term. (Respondent: Director of Commercial)
Q: What is the status of the JV with Mahindra regarding vehicle scrappage? A: The JV is on a better trajectory, with reduced losses. However, significant profits are yet to be realized due to insufficient policy support for vehicle scrappage. The business remains flat compared to previous quarters. (Respondent: Director of Finance)
Q: Can you provide an update on the data center business and expected revenue? A: MSTC is monetizing redundant capacities and plans to set up a new data center in Delhi within six months. Revenue from this business is currently commingled with other services, and specific revenue projections will be clearer in about a year. (Respondent: Director of Commercial)