NECC Shares Soar 15.5% After Acquiring Major EV Logistics Contract With Tata Steel

North Eastern Carrying Corporation Ltd (NECCL) shares have increased to Rs 23.99, a sharp increase of Rs 3.23 or 15.5% from Rs 20.76 closing price on the BSE stock exchange. This increase follows the company's announcement regarding securing a five-year electric vehicle (EV) logistics contract with Tata Steel Limited (TSL). In parallel appreciation of shares, the volume of trades of the stock also saw a marked increase, over doubling on the BSE, indicating that investors are keen on the future growth of the company.

This new contract involves the transportation of steel products, primarily coils, sheets and tubes from TSL's Sahibabad plant using electric heavy vehicles to various locations all over India. This contract is for five years, with the option to extend for an additional year, marking NECCL's major foray into EV logistics and further strengthening its promise for innovative and sustainable supply chain solutions.

Nonetheless, the performance over a nine-month period isn't as great as it seems, with net sales of Rs 240.63 crore in 9MFY25, which is slightly lower than the recorded Rs 243.27 net sales in 9MFY24. It is worth mentioning that net profit for the 9-month duration increased from Rs 5.16 crore during the last financial year, marking a 64.53% increase year on year to Rs 8.49 crore.

As of December 2024, Foreign institutional investors have shown increasing interest in increasing their stake to 0.04% from 0.01% in September 2024, which NECCL greatly welcomes. The company has a market cap of 215 crore. The promoters of the business hold a majority share, being 54.19%.

In terms of stock market performance, the shares of NECCL have risen 32.5% from the 52-week low figure of Rs 18.10 but are still below the Rs 44.40 target peak price. This stock, having been in the market for over five years, has provided an astounding over 550% returns multibaggers, ensuring growth over the longer term.

To maintain a competitive edge and improve its logistics, NECCL is building a new modern warehouse of 183,000 sq ft located in Gurugram. In these efforts, the company has transferred a single use fleet to electric vehicles and incorporated green logistics in SG Green Logistics, a subsidiary. These moves showcase NECCL's as an innovative and forward-thinking company in the making of India's logistics industry.

Offering freight forwarding, bulk transportation, and warehousing, NECCL became a major provider in India in 1984 and is currently the leading construction, transportation and logistic service provider.

The company has built a strong reputation for reliability and innovation, having established over 250 major branches and partnered with enterprises like Bajaj Auto, ITC Ltd, and Hindalco Industries.

Winning the Tata Steel EV contract marked a prestigious achievement for NECCL, as this contract enabled them to diversify their logistics capabilities into green transportation. While the company pursues the expansion of sustainable transport services, it stands to benefit greatly and foster enduring growth within the changing world of logistics.