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Container Logistics (CFS & ICD) Market – India February 2015
Executive Summary
Market
Container cargo traffic is expected to grow substantially at a CAGR of a% over the next five years owing to revival in international trade scenario CFS contributes to the maximum percentage of revenue in the container logistics market Container logistics market comprises of Container Haulage, CFS and ICD and Multimodal Transport Operator Provides various services : Cargo consolidation, distribution as well as custom clearance activities
Drivers
Drivers & Challenges
Government Initiatives
Challenges
Growth in International Trade Growth in Containerized Cargo Improvement in Custom Clearance Activities Higher Margins in Comparison with Other Logistics Activities Construction of Dedicated Freight Corridor
Poor Infrastructure Rise in Freight Costs High Costs Entailed for the Development of a Facility Archaic Procedures for the Movement of Containerized Cargo
FDI Regime – Sectors Pertaining to the Logistics Industry Maritime Agenda – Vision 2020 Capacity Expansion and Investment Opportunities along East Coast Ports Shipbuilding Subsidy and Investments
Private Investment in Logistics Parks and FTWZs Container Terminal Privatization Investment Scenario at Major Ports Projects in Progress at JN Port
Major Players
Competition
Player 1
Player 2
Player 3
Player 4
Player 5
Player 6
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•Macroeconomic Indicators •Introduction •Market Overview
•Development of the Port Sector •Prerequisite and Regulations •Government Initiative •Drivers & Challenges
•Key Issues •Trends •Competitive Landscape •Direct Investment Scenario •Strategic Recommendation •Appendix CONTAINER LOGISTICS (CFS & ICD) MARKET IN INDIA 2015.PPT
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Macroeconomic Indicators (1/3)
SAMPLE
GDP at Factor Cost: Quarterly INR tn
c3 b3 a3
d1 c2 b2 a2
c1 b1 a1
Q1
Q2 2011-12
c4 b4 a4
2012-13
2013-14
Q3 2014-15
Q4
Inflation Rate: Monthly % p
r q
s
t Jul 2013 - Aug 2013
Aug 2013 - Sep 2013
Sep 2013 - Oct 2013
Oct 2013 - Nov 2013
CONTAINER LOGISTICS (CFS & ICD) MARKET IN INDIA 2015.PPT
Nov 2013 - Dec 2013 4
•Macroeconomic Indicators •Introduction •Market Overview
•Development of the Port Sector •Prerequisite and Regulations •Government Initiative •Drivers & Challenges
•Key Issues •Trends •Competitive Landscape •Direct Investment Scenario •Strategic Recommendation •Appendix CONTAINER LOGISTICS (CFS & ICD) MARKET IN INDIA 2015.PPT
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Logistics market in India has witnessed an exponential growth rate over the past decade Logistics Market Overview – India
Logistic Market Size and Growth
• Text
INR tn +15.2%
x1
2013
x3
x2
2014e
2015e
x4
2016e
x6 x5
2017e
2018e
Logistics Performance Indicator LPI score World Rank(proportion to highest ranking nations) m
n
o
p
w
x
y
z
2007
2010
2012
2014
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Rising containerization levels for handling break-bulk commodities have increased India’s share in global markets Container Traffic Scenario in India
Containerization Levels – India vs. Global
• Text
% growth b
c
d
USA
China
Europe
a
India (2012-13)
Container Logistics Segments Container Logistics
Container Haulage
CFS & ICD
Multimodal Transport Operator (MTO)
An Inland Container Depot (ICD) & Container Freight Station (CFS) may be defined as a common user facility with public authority status equipped with fixed installations and offering services for handling and temporary storage of import/export laden and empty containers carried under customs control Note: ICD – Inland container depot, CFS – Container freight station, LCL – Less than container load, FCL – Full container load
CONTAINER LOGISTICS (CFS & ICD) MARKET IN INDIA 2015.PPT
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•Macroeconomic Indicators •Introduction •Market Overview
•Development of the Port Sector •Prerequisite and Regulations •Government Initiative •Drivers & Challenges
•Key Issues •Trends •Competitive Landscape •Direct Investment Scenario •Strategic Recommendation •Appendix CONTAINER LOGISTICS (CFS & ICD) MARKET IN INDIA 2015.PPT
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India’s container trade is estimated to cross 16 mn TEUs by 2016, with an expected shift in volume to the newer ports Container Logistics – Overview (1/2) • CFS and ICD market is an integral component of the logistics sector infrastructure • Growth in containerized cargo traffic has facilitated the development of container freight stations (CFS) and inland container depots (ICDs) CFS is largely unique to India and plays an important role in decongesting container traffic at ports, enhancing ports’ operating efficiency ICDs, also known as dry ports, cater to hinterland cargo traffic from various clusters owing to increased industrial activity
• The slowdown in India’s trade volume mostly affected the CFS & ICD market in the overall logistics sector mainly due to: The large debt-funded infrastructure investment made in the sector Rising competition
• However, as predicted by recent economic and commerce scenario, the industry is expected to grow in the next five years displaying a high single-digit growth rate on account of revival in international trade scenario post 2014-15
CFS and ICD – Market Size & Growth (Volume-wise) Container trade has been severely affected in 2013-14 with a growth of only about b%
mn TEU
X2%
X1%
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014e
2015e
2016e
2017e
2018e
Note: Market size corresponds to container cargo traffic at 15 major ports
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Export import activities are the major revenue contributors to the container logistics market Container Logistics – Overview (2/2) • The CFS and ICD market was valued at INR c bn in 2012-13 • CFS and ICD generate about their maximum revenue from import operations followed by ground handling and transportation • The industry is however expected to grow in the next five years with the revival of trade scenario post 2013-14
CFS and ICD – Revenue based Segmentation (2012-13) Sources of Revenue – CFS and ICD ICD
CFS
Sources of Revenue – Operations Handling
Rent
Import
Export
C4%
B1%
C1%
C3% C2%
B2% Note: 100% = INR c bn CONTAINER LOGISTICS (CFS & ICD) MARKET IN INDIA 2015.PPT
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Inland Container Clusters – Indian Cities Major Container Hubs in India – Hinterland
SAMPLE
• Text
Legend
% contribution to Exim
Cities
a
Text
b
Text
c
Text
d
Text
Note: The list is not exhaustive
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Tapping opportunities in the Indian CFS and ICD market • Text
Exim Container Supply Chain in India – Growth Opportunity Profitability
Market Size
% a5
b5
a2 b1 a1
a4
b2 a3
Primary Transport
CFS and ICD
b4
b3
Secondary Transport
Ports
CONTAINER LOGISTICS (CFS & ICD) MARKET IN INDIA 2015.PPT
Ocean Transport 12
Container Logistics Infrastructure – Current Scenario Opportunity for Investors in Container Logistics across the Exim Supply Chain Rail/road movement for containers
Customers
text
text
text
Shipping Lines
Scope of business for investors
Estimated Investment – Future Scenario Type of Infrastructure
Estimated nos./ demand in next 510 years
INR bn ~ INR z bn investment is needed for container logistics infrastructure by 2020
ICD/FTWZ Air Cargo Centres Agro Warehouses Integrated Transport Centres
ICD/FTWZ
Air Cargo Centres
Agro Warehouses
CONTAINER LOGISTICS (CFS & ICD) MARKET IN INDIA 2015.PPT
Integrated Transport Centres 13
India is witnessing a transition from bulk cargo to containerization of traditionally non containerized cargo • Text
Current Container Scenario in India Containerization Penetration in India Containerization Levels
Vessel Traffic, Major Ports (2012-13)
Others B5% Container
B4%
B1%
Dry Bulk Liquid Bulk Break Bulk Others 2009
2010
2011
2012
B3%
B2%
2013
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•Macroeconomic Indicators •Introduction •Market Overview
•Development of the Port Sector •Prerequisite and Regulations •Government Initiative •Drivers & Challenges
•Key Issues •Trends •Competitive Landscape •Direct Investment Scenario •Strategic Recommendation •Appendix CONTAINER LOGISTICS (CFS & ICD) MARKET IN INDIA 2015.PPT
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Existence of IRS in container shipping industry enforces competition in upstream and downstream industries Growing Demand for Container Transport • Text
Reasons contributing to growing CFS and ICD
The Container Shipping Market
Share of Container Traffic in Total Trade (2013-14)
Container P.O.L
B5%
Iron Ore
Government Initiatives Schemes to develop new airports in Tier I and Tier II cities will be launched for implementation through the Airport Authority of India or the PPP mode
Coal Others
B4% B3% B2%
B1%
Note: Percentage share in tonnage for major ports only
Note: IRS – Increasing Returns to Scale
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Rapid growth of sea freight volumes are a major boost to the development of CFS and ICD facilities Development of Sea Freight Sea Freight – Market Size and Growth Major Ports
Minor Ports
MMT X%
2005
• Text
2006
2007
2008
2009
2010
2011
2012
2013
2014
SAMPLE
Note: MMT: million metric ton
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•Macroeconomic Indicators •Introduction •Market Overview
•Development of the Port Sector •Prerequisite and Regulations •Government Initiative •Drivers & Challenges
•Key Issues •Trends •Competitive Landscape •Direct Investment Scenario •Strategic Recommendation •Appendix CONTAINER LOGISTICS (CFS & ICD) MARKET IN INDIA 2015.PPT
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Investment in Logistics Infrastructure (1/3) FDI Regime – Sectors Pertaining to the Logistics Industry FDI Equity Inflows over the Years
FDI in Logistics Sector
INR mn
INR mn
2008-09 2009-10 2010-11 2011-12 2012-13
2009-10
2010-11
2011-12
2012-13
FDI in Transport and Infrastructure, INR mn Railway Related Components
Air Freight
Shipbuilding
Air Transport
Sea Transport
Construction of Roads and Highways
100% FDI is allowed • In maritime infrastructure such as ports, terminals, jetties, harbors and merchant shipbuilding • Support infrastructure like warehousing, CFS and ICD, roads, inland water transport (IWT) and other logistics components
Jan - Sep, 2013 CONTAINER LOGISTICS (CFS & ICD) MARKET IN INDIA 2015.PPT
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Rail and road connectivity projects to ports will provide a rapid boost to container freight handling Shipbuilding Subsidy and Investments • Text
SAMPLE Ports
Phase I (2010-12)
Phase II (2012-17e)
Phase III (2017-20e)
Total Investment (INR bn)
Chennai Kolkata V.O. Chidambaranar Ennore Cochin Vishakapatnam JNPT Paradip Mumbai Kandla New Mangalore Mormugao Total (INR bn) CONTAINER LOGISTICS (CFS & ICD) MARKET IN INDIA 2015.PPT
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Planned Investment on Projects – JN Port (2010-2020) Deepening of Channel / berths
Projects till 2020
Construction/ Reconstruction of Berths / Jetties
Procurement of Equipment
Rail / Road Connectivity Works
Other Works
Total
No. of Project Ongoing Projects
Estimated Cost. (INR bn) No. of Project
Phase –I (2010-2012)
Estimated Cost. (INR bn) No. of Project
Phase –I (2012-2017)
Estimated Cost. (INR bn) No. of Project
Phase –I (2017-2020)
Estimated Cost. (INR bn)
No. of Project Total Projects (Ongoing + New)
Estimated Cost. (INR bn)
Note : Estimated Cost is for the projects proposed to be taken up /under execution during that period
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Investment Scenario at Major Ports (1/4) Ports
Recent and Emerging Opportunities
Estimated Cost (INR mn)
Capacity (MTPA)
Investments Undertaken
Estimated Cost (INR mn)
Capacity (MTPA)
JNPT
Mumbai Port
Mormugao Port
Cochin Port
Note : Estimated Cost is for the projects proposed to be taken up /under execution during that period
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•Macroeconomic Indicators •Introduction •Market Overview
•Development of the Port Sector •Prerequisite and Regulations •Government Initiative •Drivers & Challenges
•Key Issues •Trends •Competitive Landscape •Direct Investment Scenario •Strategic Recommendation •Appendix CONTAINER LOGISTICS (CFS & ICD) MARKET IN INDIA 2015.PPT
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Growth in international trade is the most vital driving factor for the container logistics market Growth in International Trade (1/2)
Impact
• Text
SAMPLE India’s Total Export
India’s Total Import Government of India plans to double India’s exports of goods and services by 2014-15
INR tn X1%
INR tn
X2%
Imports into India are also expected to grow further, particularly of oil and capital good
2009-10 2010-11 2011-12 2012-13 2013-14
2009-10 2010-11 2011-12 2012-13 2013-14
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The rise in containerized cargo traffic has led to the growth in CFSs and ICDs Growth in Containerized Cargo (1/2)
Impact
• Text
SAMPLE Container Traffic Projection for All Indian Ports mn tons a4
X% a3 a2 a1
2016-17e
2021-22e
2026-27e
CONTAINER LOGISTICS (CFS & ICD) MARKET IN INDIA 2015.PPT
2031-32e 25
Cargo handling capacity should be 30% more than projected traffic to minimize pre berthing detention of ships Growth in Containerized Cargo (2/2) • Text
SAMPLE Cargo Capacity Creation Projection for All Indian Ports mn tons
POL
Iron Ore
Coal
Containers
Other Cargo
a4
a3 a2 a1
2016-17e
2021-22e
2026-27e
CONTAINER LOGISTICS (CFS & ICD) MARKET IN INDIA 2015.PPT
2031-32e 26
Large set up costs and cumbersome procedures for transporting containerized cargo are the major barriers High Costs Entailed for the Development of a Facility
Impact
• Text
SAMPLE Commodity-wise Capital Cost Incurred for Capacity Addition
INR mn per ton a5
a2 a1
POL
Iron Ore
a3
a4
Fertilizers
Coal
CONTAINER LOGISTICS (CFS & ICD) MARKET IN INDIA 2015.PPT
a6
Containers
Other General Cargo
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•Macroeconomic Indicators •Introduction •Market Overview
•Development of the Port Sector •Prerequisite and Regulations •Government Initiative •Drivers & Challenges
•Key Issues •Trends •Competitive Landscape •Direct Investment Scenario •Strategic Recommendation •Appendix CONTAINER LOGISTICS (CFS & ICD) MARKET IN INDIA 2015.PPT
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Porter’s Five Forces Analysis
SAMPLE Impact Low
Threat of New Entrants • Text
Impact Medium to High
Impact Medium Impact Medium to High Competitive Rivalry
Bargaining Power of Buyers
Bargaining Power of Suppliers • Text
• Text
• Text
Impact Low Threat of Substitutes • Text
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Competitive Benchmarking (2/5)
SAMPLE
Key Ratios of Top 3 Companies – Operational Basis (FY 2014) (1/3) Gross Margin
%
Operating Margin
Net Margin c3 c2
c1
a1
a2
b2
a3
b3
b1 Player 1
Player 2
Player 3
• Text
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SAMPLE
Public: Domestic Company – Player 1 (1/5) Company Information
Offices and Centres – India
Corporate Address
Tel No. Fax No. Website Year of Incorporation
Head Office
Ticker Symbol Stock Exchange
Products and Services Category
Products/Services
Key People Name
Designation
Sectors (EPC)
CONTAINER LOGISTICS (CFS & ICD) MARKET IN INDIA 2015.PPT
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SAMPLE
Public: Domestic Company – Player 1 (2/5) Financial Snapshot
Key Ratios
Total Income
Net Profit/Loss
Particulars
INR mn
INR mn p1
p2
p4 p3 r4
r1
r2
r3
2011
2012
2013
2014
Financial Summary • The company earned a net profit of INR - mn in FY 2014, as compared to net profit of INR - mn in FY 2013 • The company reported total income of INR - mn in FY 2014, registering an increase of -% over FY 2013 • The company earned an operating margin of -% in FY 2014, a decrease of m percentage points over FY 2013 • The company reported debt to equity ratio of - in FY 2014, registering an increase of -% over FY 2013
Key Financial Performance Indicators Indicators
Value (11/27/2014)
y-o-y change (2014-13)
2014
2013
2012
2011
Profitability Ratios Operating Margin Net Margin Profit Before Tax Margin Return on Equity Return on Capital Employed Return on Working Capital Return on Assets Return on Fixed Assets
Cost Ratios Operating costs (% of Sales) Administration costs (% of Sales) Interest costs (% of Sales)
Liquidity Ratios Current Ratio Cash Ratio
Leverage Ratios Debt to Equity Ratio Debt to Capital Ratio Interest Coverage Ratio
Efficiency Ratios Fixed Asset Turnover Asset Turnover Current Asset Turnover Working Capital Turnover Capital Employed Turnover
Market Capitalization (INR mn) Total Enterprise Value (INR mn) EPS (INR)
PE Ratio (Absolute) Note : This company has had a fiscal year change on Dec-31, 2011
CONTAINER LOGISTICS (CFS & ICD) MARKET IN INDIA 2015.PPT
Improved
Decline
32
SAMPLE
Public: Domestic Company – Player 1 (3/5) Key Business Segments
Key Geographic Segments
Container Freight Stations
Multimodal Transport Operations
Project & Engineering Solutions
Others
Australia & New Zealand
Mediterranean
Far East
Africa
America
India
Europe
%
%
2010
2012
2013
2014
2010
2012
2013
2014
Business Highlights (1/2) Description
News
Overview
• Text
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SAMPLE
Public: Domestic Company – Player 1 (4/5) Business Highlights (2/2) Description
News
Extensive Product Portfolio
• Text
Awards and Recognitions
• Text
Acquisitions
• Text
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SAMPLE
Public: Domestic Company – Player 1 – SWOT Analysis (5/5)
• Text
• Text
• Text
S
W
O
T • Text
CONTAINER LOGISTICS (CFS & ICD) MARKET IN INDIA 2015.PPT
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SAMPLE
Private: Foreign Company – Player 2 (1/5) Company Information
Offices and Centres – India
Corporate Headquarter
Tel No.
Fax No. Website Year of Incorporation Head Office
Products and Services Category
Sectors (EPC)
Products/Services
Key People Name
CONTAINER LOGISTICS (CFS & ICD) MARKET IN INDIA 2015.PPT
Designation
36
SAMPLE
Private: Foreign Company – Player 2 (2/5) Shareholders of the Company
Ownership Structure Foreign Holdings
Name
No. of Shares held
Total 100.0% 100%
Ownership structure corresponds to Date of AGM: 31/03/2012
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SAMPLE
Private: Foreign Company – Player 2 (3/5) Financial Snapshot Total Income
Key Ratios Net Profit/Loss
Particulars
INR mn
INR mn p3
p4
r2
r3
r4
2011
2012
2013
p2 p1
r1
2010
Financial Summary • The company earned a net profit of INR - mn in FY 2013, as compared to net profit of INR - mn in FY 2012 • The company reported total income of INR - mn in FY 2013, registering an increase of -% over FY 2012 • The company earned an operating margin of -% in FY 2013, an increase of k percentage points over FY 2012 • The company reported debt to equity ratio of q in FY 2013, an increase of % over FY 2012
y-o-y change (2013-12)
2013
2012
2011
2010
Profitability Ratios Operating Margin Net Margin Profit Before Tax Margin Return on Equity Return on Capital Employed Return on Working Capital Return on Assets Return on Fixed Assets
Cost Ratios Operating costs (% of Sales) Administration costs (% of Sales) Interest costs (% of Sales)
Liquidity Ratios Current Ratio Cash Ratio
Leverage Ratios Debt to Equity Ratio Debt to Capital Ratio Interest Coverage Ratio
Efficiency Ratios Fixed Asset Turnover Asset Turnover Current Asset Turnover Working Capital Turnover Capital Employed Turnover Improved
CONTAINER LOGISTICS (CFS & ICD) MARKET IN INDIA 2015.PPT
Decline
38
SAMPLE
Private: Foreign Company – Player 2 (4/5) Business Highlights Description
News
Overview
• Text
Awards and Recognitions
• Text
Industries Served
• Text
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SAMPLE
Private: Foreign Company – Player 2 – SWOT Analysis (5/5)
• Text
• Text
• Text
S
W
O
T • Text
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•Macroeconomic Indicators •Introduction •Market Overview
•Development of the Port Sector •Prerequisite and Regulations •Government Initiative •Drivers & Challenges
•Key Issues •Trends •Competitive Landscape •Direct Investment Scenario •Strategic Recommendation •Appendix CONTAINER LOGISTICS (CFS & ICD) MARKET IN INDIA 2015.PPT
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SAMPLE
Direct Investments – Player 5
Overall Investments – Geography-wise
Total Investments – Sector-wise
C1%
B1% Industrials Financials
Asia Pacific Emerging Markets
B2%
C2%
Industrial Investments – Segment-wise
Asia Pacific Developed Markets
Investment Snapshot • Text
A1%
A2%
A3%
100%
Capital Goods Commercial and Proffessional Services Transportation 42
•Macroeconomic Indicators •Introduction •Market Overview
•Development of the Port Sector •Prerequisite and Regulations •Government Initiative •Drivers & Challenges
•Key Issues •Trends •Competitive Landscape •Direct Investment Scenario •Strategic Recommendation •Appendix CONTAINER LOGISTICS (CFS & ICD) MARKET IN INDIA 2015.PPT
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SAMPLE
Strategic Recommendation (3/3)
Improving Efficiency of Container Ports
Text
Text
Text
Text
Efficiency Specific Variables for Ports
Text
Text
Port Throughput (TEU)
Resultant Output of Container Traffic
Text
Text
Efficiency Specific Variables for Terminals
Text
Port Throughput (TEU)
Resultant Output of Container Traffic
• Text
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