AVG Logistics Secures 5-Year Contract Worth ₹18 Crore Annually

AVG Logistics will receive approximately ₹18 crore per annum for five years.
The company is deploying 30 heavy-duty electric trucks for the deal.

Reader Takeaway: Long-term contract offers predictable revenue, while EV deployment signals a green logistics push.

What just happened

AVG Logistics has entered into a significant 5-year contract, with an option to extend for another 3 years, with a prominent cement manufacturer. The contract is valued at approximately ₹18 crore per annum. It covers the management of inbound and outbound logistics for raw materials and finished goods, primarily serving industrial corridors in the North East region.

Why this matters

This order win is crucial as it provides AVG Logistics with a stable, long-term revenue stream. The deployment of 30 heavy-duty electric vehicles (EVs) demonstrates the company's commitment to sustainable logistics and positions it to benefit from the growing focus on green transportation infrastructure. The contract is expected to strengthen the company's financial standing and potentially improve margins through operational efficiencies.

The backstory

AVG Logistics is an integrated logistics solutions provider in India. The company has been focusing on expanding its fleet and technological capabilities to cater to the evolving needs of its clients. This contract aligns with their strategy to secure multi-year deals and invest in greener logistics solutions.

What changes now

AVG Logistics will immediately begin managing the logistics operations for the cement manufacturer. This includes establishing and operating dedicated EV charging stations. The company anticipates that the integration of GPS monitoring, digital automation, and the use of EVs will lead to margin expansion. The financial performance for FY25 shows Revenue at ₹551.52 crore, EBITDA at ₹95.57 crore, and PBT at ₹26.33 crore.

Risks to watch

Potential risks include the timely execution of the contract, operational challenges with EV fleet management, and fluctuations in raw material or energy costs affecting profitability. The company's ability to successfully integrate and manage the new EV fleet and charging infrastructure will be critical.

Peer comparison

Companies like Delhivery, Blue Dart, and Mahindra Logistics are also active in the integrated logistics and supply chain management sector in India. These players are also increasingly focusing on technology adoption and fleet electrification to enhance efficiency and sustainability.

Context metrics (time-bound)

For the fiscal year 2025, AVG Logistics reported a revenue of ₹551.52 crore, an EBITDA of ₹95.57 crore, and a Profit Before Tax (PBT) of ₹26.33 crore.

What to track next

Investors will be looking for updates on the successful deployment and operational efficiency of the 30 EV trucks. Monitoring the contract's contribution to revenue and profit growth in the upcoming quarters will be key. The company's progress in establishing and managing the EV charging infrastructure also warrants attention.