TCI Seaways revenue rises 16.7% as bunker costs trim margins

TCI Seaways increased H1 FY27 revenue 16.7% year on year to Rs 329.5 crore through price-led growth despite static volumes, while EBIT margin declined to 35.8% from 39.5% as bunker prices affected margins. The business is expanding with two vessels under construction and the acquired 500-TEU TCI SETU carrier.

Why did TCI Seaways revenue rise while margins declined?

TCI Seaways reported price-led growth amid static volumes, with revenue rising 27.9% year on year to Rs 171.6 crore in Q2 FY27 and 16.7% to Rs 329.5 crore in H1 FY27. The comparable figures were Rs 134.1 crore in Q2 FY26 and Rs 282.4 crore in H1 FY26. The presentation identifies pricing, rather than volume growth, as the source of the increase.

Profit increased in rupee terms but at a slower rate than revenue. Earnings before interest, depreciation, tax and amortisation (EBIDTA) rose 12.3% to Rs 69.7 crore in Q2 FY27 and 6.9% to Rs 137.3 crore in H1 FY27. Earnings before interest and tax (EBIT) increased 12.1% to Rs 59.8 crore for the quarter and 5.7% to Rs 117.8 crore for the half year.

TCI Seaways’ Q2 EBIT margin fell 4.9 percentage points year on year, while its H1 EBIT margin fell 3.7 percentage points. The presentation attributes the margin effect to bunker prices and separately tracks average low-sulphur fuel prices per metric tonne across FY25, FY26 and FY27. It does not disclose the monthly fuel-price values in the displayed chart.

How is TCI Seaways expanding its fleet?

TCI Seaways operates six Indian-flagged vessels across India’s eastern, western and southern coasts, with domestic coastal connectivity covering seven ports. In FY26, it reported 77,957 deadweight tonnes of vessel capacity and more than 8,500 multipurpose containers. Its services include coastal shipping, multimodal transport integration and specialised container movement.

TCI Seaways says two additional vessels are under construction and are to be commissioned by Q3FY27. This is a planned capacity addition, not a completed one. The presentation does not disclose the vessels’ capacity, acquisition cost, routes or expected revenue contribution.

TCI Seaways has also acquired a 500 twenty-foot equivalent unit (TEU) cellular container carrier named TCI SETU, which is to be operational during November 26. A TEU is a standard measure of container capacity. The source does not state whether TCI SETU is included in the reported six-vessel operating fleet, so the acquisition should not be used to calculate a revised fleet total.

How have TCI Seaways’ revenue and returns changed?

TCI Seaways’ revenue increased to Rs 615.1 crore in FY26 from Rs 587.7 crore in FY25 and Rs 522.4 crore in FY24. EBIT margin rose from 26.5% in FY24 to 34.1% in FY25 and 36.7% in FY26. However, the H1 FY27 EBIT margin of 35.8% was below the 39.5% recorded in H1 FY26.

The comparison shows that the business delivered higher annual revenue and margins through FY26, before the reported half-year margin decline in FY27. H1 FY27 revenue of Rs 329.5 crore was above H1 FY26 revenue of Rs 282.4 crore, but the rate of EBIT growth, at 5.7%, was below revenue growth of 16.7%.

TCI Seaways reported capital employed of Rs 636 crore in H1 FY27, compared with Rs 409 crore in H1 FY26 and Rs 466.5 crore in FY26. Return on capital employed declined to 42.7% in H1 FY27 from 57.6% in the prior-year half and 60.7% in FY26. The presentation does not assign a cause for either the higher capital employed or the lower return measure.

What industry trends support TCI Seaways’ expansion plan?

TCI Seaways cites coastal cargo traffic growth of 119% over the last decade as a sector driver. The presentation says National Waterways increased from five to 111, while operational length expanded from 2,716 kilometres to 4,894 kilometres. These are industry indicators rather than operating measures reported by TCI Seaways.

The Coastal Cargo Promotion Scheme targets an increase in coastal shipping’s modal share to 12% by 2047 from 6%. The presentation also cites inland-waterways cargo growth from 18 million metric tonnes to more than 145 million metric tonnes, with a target of more than 200 million metric tonnes by 2030. It gives an outlay of about Rs 5,165 crore for Sagarmala and Maritime India Vision 2030, up 48% year on year.

TCI Seaways presents these policy and infrastructure developments as support for lower-cost, sustainable coastal and inland shipping. They do not quantify future revenue or cargo volumes for the business. Its disclosed operating evidence remains price-led H1 FY27 revenue growth amid static volumes, alongside the planned vessel commissioning and TCI SETU operational start.

Conclusion

TCI Seaways delivered higher revenue in Q2 FY27 and H1 FY27, but profit growth did not match the revenue increase as bunker prices affected margins. EBIT margin declined in both reporting periods, while capital employed rose and return on capital employed fell to 42.7% in H1 FY27. The results show pricing supported revenue even without volume growth.

The next disclosed milestones are the operational start of the 500-TEU TCI SETU during November 26 and the commissioning of two vessels by Q3FY27. The presentation does not disclose the additional vessels’ capacity or deployment, leaving their contribution to the six-vessel fleet, revenue and margins unresolved.