2 1 A U G ’ 1 2 – 3 S E P ’ 1 2
Logistics Track Research4I nd ia For t n ight l y updat e o n L og is t i c s I ndust ry
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In The Spotlight Contents
Essar Shipping may raise over ` 25bn for
expansion
Essar Shipping, the demerged entity of Essar
Shipping Ports & Logistics, will look to raise more
than ` 25bn through market instruments to fund its
capital expansion plans. According to the sources,
Essar Shipping said that the company would raise $
500mn, or its equivalent, in Indian currency through
issue of securities, GDRs, FCCBs, or any other issue
of security to meet the company’s expansion plans,
including acquisition of various assets, and enhance
its global competitiveness. According to the reports,
the company requires funds for expansion and to
meet its capex plans and investments. To achieve a
significant competitive advantage, the company may
need to issue equity shares or GDR or any form of
securities in international or domestic markets. But
according to senior company officials, the plan to
raise funds from the market is largely aimed at
bringing down the promoter holding in the company
from the existing 84%.
Gati seeks partner for shipping unit
Gati Ltd, an express distribution and supply chain
provider, is looking at benefiting from the recent
restructuring of its business. The company is planning
to rope in a strategic partner in its shipping division,
which was hived off into a separate subsidiary in
March. The company is also planning to set up a pan-
India cold chain network. With supply chain being
company’s core business, Gati is looking at increasing
its fleet capacity by 2015. Gati will increase its
existing fleet of trucks from 165 trucks to 350. As
part of the capital expenditure plan, Gati will invest `
1.85bn for the next three years. Out of the total
investment, ` 1bn will go into setting up a cold
storage network, while the rest will go into fleet
expansion and IT. The company hopes to grow at
20% on an annual basis.
News of the fortnight 1
Investment Activity 3
News Update 4
Global News Update 6
Stock Market Updates 11
Peer Benchmarking
12
About Four-S Services 13
Four-S India
Logistics Report
2011-12
Our logistics
report is now
available for
purchase. A
100 page, hard
bound word
document,
presented by
Central, this is
India’s most
comprehensive
and rigorous
research report
on Logistics.
To buy the report, or to know
more about it, see Page 2.
Logistics Track
Research4India 2
Central Logistics Intelligence presents
“Four-S India Logistics Report 2011-12”.
This is the first comprehensive, rigorous report on the
logistics sector. It brings a new analytical perspective
to the sector research coverage, which is plagued by
poor research. Incorrect notions like: the Indian
logistics sector is 13-14% of GDP; or there is multiplier
of 2x between logistics growth and GDP growth rate –
abound, and are often quoted by leading logistics
companies, industry associations and sector
consultants.
The report presents original data and analysis on several key
aspects of the sector, including size of various segments and
projections, and highlights investment potential. In the report
we have taken a comprehensive look at all the key segments
of logistics and supply chain.
We find EXIM and agri-logistics areas of great promise. The 3PL/contract logistics
space also has strong potential, which will get a push as and when the long awaited
goods and services tax (GST) reforms are implemented. We expect greater activity
from PE funds and MNCs in this decade compared to 2001-10.
The report includes information about the key players in the Indian logistic sector and its
various segments.
“Four-S India Logistics Report 2011-12” is prepared by the research of Four-S Services
(www.four-s.com), which has covered this sector in detail in India for several years now.
REASONS TO BUY
India’s first comprehensive report on the logistics and supply chain business
The report has original numbers and projections, backed by rigorous analysis, which would
compel you to question some of the established facts floating around about the sector.
Takes a detailed look at all key business segments, and highlights growth potential.
Mentions key listed and unlisted companies in the sector.
FOR WHOM
Companies in the supply chain and logistics business in India, logistics MNCs wanting to enter
India, private equity funds, industry associations, policy makers, independent consultants and
industry researchers
HOW TO BUY
Kindly write to Seema Shukla at [email protected] You can also call Ashutosh Sharma at
0124-425 1442, or Devendra Deole at 022-42153659 to book your copy.
Logistics Track
Research4India 3
PE Deals in 2012
Date Investor Target Stake
(%) Amount ($ mn)
Strategy
6-Jan General Atlantic Foursee Infrastructure Equipments Ltd.
NA 20.8 Growth
23-Feb IDFC Private Equity StarAgri Warehousing & Collateral Mgmt
NA 30.0 Growth
23-Feb Global Super Angels Chhotu.in (Santa Claus Couriers) NA NA Angel 28-Mar Ambit Pragma Spear Logistics NA 1.7 Growth 30-Mar VenturEast, Zephyr Peacock e2E Rail NA 6.0 Early 26-Apr New Silk Route VRL Logistics NA 33.4 Late 19-Apr KKR, Goldman Sachs TVS Logistics 20.0 55.0 Growth 29-Jun Vertex Venture Holdings, KPCB,
Sherpalo Ventures Reverse Logistics NA NA Growth
25-Jul Ambit Pragma Mehta Frozen Foods Carriers 74.0 NA Early 19-Aug GTI Capital Brattle Foods NA NA Growth
The space saw 10 deals till date raising a total disclosed amount of $185.1mn.
Mergers & Acquisitions in 2012
Date Investor Target Stake
(%) Amount ($ mn)
Business
1-Feb Oil Field Warehousing & Services Raamns Shipping & Logistics NA NA Logistics Services 20-Apr DHL Express (India) Pvt Ltd DHL Lemuir Logistics Pvt Ltd 24.0 NA Logistics Services 15-May DTDC Eurostar Express NA NA Courier Services 18-Jul SG Holdings Sindhu Cargo Services 40.0 NA* Logistics Services 18-Jul SG Holdings Sunlog Services 40.0 NA* Logistics Services
16-Aug Dempo Group Modest Infrastructure NA 140.0 Ship-building & Repair *SG Holdings have invested a total of $18mn in Sindhu Cargo Services and Sunlog Services which are sister concerns
The space saw 6 deals till date but the transaction details were disclosed for one only.
Dempo Group acquired ship-building & repair company Modest Infrastructure for $
140mn in August 2012.
In 2011, there were 11 PE deals in Logistics space worth $278.1mn. The largest among
came from Warburg Pincus which invested $100mn in Continental Warehousing
Corporation for un-disclosed stake.
In the same year, 8 M&A deals in Logistics space. TVS Logistics acquired 100% stake in
US based MESCO for un-disclosed amount. Amongst the disclosed, the largest was 100%
stake by Royal Vopak in CRL Terminals for $61.8mn
Investment Activity
Logistics Track
Research4India 4
MIV invests ` 700mn at Vallarpadam
MIV Logistics Pvt Ltd, a company promoted by
INKEL Ltd in association with MFar Enterprises
Pvt Ltd and VKL Estates Pvt Ltd, is constructing
a container freight station at Vallarpadam at an
estimated cost of ` 700mn. The facility, being
developed on 18.5 acres of land on 30 years of
lease from the Cochin Port Trust, is expected to
be partly operational by December 2012 and
fully operational by October 2013. The station,
when fully commissioned, will have a capacity
to handle 100,000 TEUs (twenty-foot equivalent
units) per annum, both for export and import.
The facility will also have a warehouse of
60,000 square feet capacity. There will be an
open yard of over 500,000 square feet for
storage of containers too. While the permanent
facilities are being owned by MIV, the
equipment and operating personnel will be
provided by the operator - APM Terminals India
Pvt Ltd. All operational expenses will be borne
by APM Terminals and the gross revenue will be
shared between MIV and APM at agreed
proportions.
Japan buys stake in India infrastructure
firm
Japan would buy a major stake in an Indian
company at the centre of a huge infrastructure
building project, marking Tokyo's latest
investment in the South Asian giant. The
government-linked Japan Bank for International
Cooperation would purchase a 26% stake in the
Delhi-Mumbai Industrial Corridor Development
Corp. (DMIC). The Indian firm has been
charged with building massive projects linking
Delhi and Mumbai including a freight railway
between the two Indian cities. Other projects
include industrial parks and power stations that
are expected to be built around the rail line.
Belgian firm Ahlers to set up chemical
warehouse in Gujarat
Belgium-based logistics and maritime service
provider Ahlers plans to set up a chemical
warehousing facility in Gujarat. The warehouse
will handle and store packed chemicals,
including hazardous goods.
Chemical storage in India is still at a nascent
stage, with factories finding it difficult to
transport critical products to their
customers/ports without adequate storage
facility in the supply chain. There is
considerable scope for such investment. Foreign
players like Rhodea have already entered the
chemical storage business in India. Local
players are also active in this trade with their
own brand of chemical warehousing, according
to the MD, Alhers - Pradeep Joseph. Ahlers has,
in Ghent (Belgium), a chemical warehouse
facility to handle all type of chemicals, including
hazardous ones. It also has warehousing
facilities in Russia, the Ukraine, China and
Indonesia for warehousing goods other than
chemicals, such as tobacco. The location of the
Gujarat facility has yet to be finalised. Ahlers
India handled around 20,000 TEUs (twenty-foot
equivalent units) in 2011-12 and about 15,000
tonnes of project cargo, mainly to the Africa
region.
DP World brings all Indian arms under one
roof for IPO
DP World, the London Stock Exchange-listed
container terminal operator from Dubai, is
preparing ground for an initial public offering
(IPO) for its Indian subsidiary. The largest
foreign operator in India’s port sector, which
operates five container terminals in the country
through independent special purpose vehicles
(SPVs), is bringing all its operations under one
holding company, as an initial step. According
to the people familiar with the development,
the company's plan stems from its huge
requirement of funds for expansion as well as a
need to cut down the existing debt. The Dubai
company, which was just a marginal player in
India, became a dominant player overnight
after it acquired terminal assets of P&O Ports in
2006 in a mega international takeover. Three
News Update
Logistics Track
Research4India 5
operating terminals at Jawaharlal Nehru Port
(JNPT), Chennai and Mundra went to DP World,
following the acquisition. DP World holds
81.63% stake in India Gateway Terminal, which
operates India’s only transhipment container
terminal at Vallarpadam in Kochi. The company
runs another container terminal in
Visakhapatnam in joint venture with Mumbai-
based United Liner Agencies (ULA), a leading
ship agency, and holds 26 per cent stake. It
also operates container rail freight operations in
India through a wholly-owned company --
Container Rail Road Services. The global
operator of container and marine terminals has
operations in more than 35 countries and
employs over 30,000 people.
GVK Power and Infrastructure to sell stake
in Australian rail and port subsidiaries
GVK Power and Infrastructure, a builder of
power plants and airports, will sell minority
stakes in its Australian rail and port subsidiaries
to raise funds for developing a coal mine in
Queensland. The company, which had acquired
a controlling stake in Australia's Hancock
Prospecting coal mines last year, needs to
invest $10bn to mine and build rail and port
facilities that can transport coal from the mines
to India and other countries. Last year, GVK
Power had acquired 79% in the Alpha Coal and
Alpha West projects and 100% stake in the
Kevin's Corner project in Queensland from
billionaire mining heiress Gina Reinhart for
$1.26bn. It had also acquired 100% stake in a
500 km rail line and a 60-mn-tonne-per-annum
port to boost GVK's plan to export coal to power
plants in India and China.
NTPC to fund coal transport infrastructure
in India
NTPC Limited has devised a way to move coal
from the mines to its power plants. It is
offering Indian Railways the money to set up
the required rail links. The country’s largest
power producer and coal consumer, NTPC,
proposes to recover the investment by setting it
off against freight charges levied by the cash
strapped railways for moving coal. NTPC’s
proposal pertains to the Railways’ Infrastructure
for Industry Initiative which is currently being
discussed at an inter ministerial level and will
be sent to the cabinet for approval. Indian
Railways moves 52% of the coal that is mined
in the country, a share that’s expected to rise
to 58% in 2016 to 2017. India has a power
generation capacity of 205,340 MW of which
56.7%, or 116,333 MW is coal based. With
more than half of India’s total power generation
currently based on coal, the power sector is the
major consumer of the fossil fuel, absorbing
nearly 78% of total domestic production.
Railways PPPs need ` 800bn
According to a report, an estimated ` 800bn of
private investment will be required for
implementation of various PPP (public private
partnership) projects identified by the Railways.
The areas to be covered under PPP will include
an elevated rail corridor, high-speed corridors,
redevelopment of stations, logistics parks,
private freight terminals, port connectivity,
dedicated freight corridor, loco and coach
manufacturing units, energy conservation, etc.
The projects identified include the ` 200bn
Mumbai-Ahmedabad high-speed corridor, the `
200bn elevated rail corridor between
Churchgate and Virar in Mumbai, ` 100bn for
redevelopment of stations, the ` 100bn
dedicated freight corridor between Sonnagar
(Bihar) and Dankuni (Bengal), ` 60bn for
energy projects, ` 50bn for port connectivity
projects, ` 30bn loco and coach manufacturing
units, ` 30bn logistics parks and ` 28.15bn
private freight terminals and other freight
schemes. A modified outlay of ` 5.48tn has
been proposed for the 12th Five Year Plan by
the Ministry to Planning Commission for
meeting the requirements of expansion,
modernisation and safety. For financing this
outlay, gross budgetary support, successful
implementation of PPP in identified areas and
mobilisation of internal resources through
conventional and non-conventional means
would be necessary. Indian Railways, it is
learnt, is open to foreign direct investment
(FDI) in PPP projects within the overall FDI
policy framework.
Logistics Track
Research4India 6
Demand for logistics spaces increase in H1
2012
According to the findings of CBRE's latest report
titled "India Logistics Market View", India
witnessed an increased market activity in H1
2012. Demand for logistic and warehousing
spaces was not only limited to leading cities
such as NCR (National Capital Region), Mumbai
and Bangalore, but was also spread across the
leading tier II cities. E-tailers invested heavily
into strategically located assets, and have been
taking up quality warehousing space across
India, primarily in NCR, Mumbai and Bangalore.
However, availability of large land parcels at
relatively low cost, connectivity to multiple
markets across states and industrial clusters,
has led to the emergence of some tier-II and
tier-III cities as favoured destinations for the
development of logistics parks and warehouses.
FMCG majors, white goods and consumer
electronics firms are also on an expansion spree
and are steadily increasing their footprint
across the country. Built-to-suit options have
been the preferred mode of expansion for most
occupiers, with large sized transactions of
around 10,000 -15,000 sq ft of warehousing
space being reported in the first half of 2012.
Industrial corridor planned along NH-33
The state industry department of Jharkhand has
plans to develop an industrial corridor along the
Koderma-Bahragora four-lane NH-33. According
to sources in the department the plan to
develop a special industrial corridor on either
side of the NH was mooted to end the
connectivity problem faced by industries due to
lack of basic infrastructure in most places to
handle heavy vehicles carrying load of over 30-
35 tonne. Adityapur Industrial Area, one of the
biggest hubs of the country, has been facing
problem due to poor road and power supply for
over a decade now. The corridor will cover a
25-km stretch on either side of the 400-km-
long NH-33 that passes through Ranchi and
Jamshedpur. The highway touches Bihar on one
side and Odisha and West Bengal on the other.
The corridor will be equipped with an array of
infrastructural support such as power facilities,
rail connectivity, industrial estates, special
economic zones and cluster with top-of-tine line
infrastructure.
Rail corridors’ MoU by Sept
The Chhattisgarh Government will develop two
special purpose vehicles (SPVs) with South
Eastern Coalfields Ltd and IRCON (public sector
unit of Indian Railways) for development of rail
corridors. The memorandum of understanding
for this will be signed by September 30. The
State Government, IRCON and SECL will be
shareholders in the SPVs. The 180-km East
Corridor and -km East-West corridor are
proposed to be developed in Chhattisgarh to
facilitate transportation of goods and increase
the passenger facility. Other companies and
industrial houses also can use this facility by
paying. The East Rail Corridor is proposed to be
constructed from Bhupdeopur-Gharghora-
Dharamjaigarh to Korba whereas East-West
Corridor is proposed to be developed between
Gevra Road-Dipika-Kathghora- Sindurgarh-
Pasan and Pendra Road. The two rail corridor
will not only increase rail density but also
facilitate industrialisation in this mineral rich
territory.
Horticulture Express loses steam
Despite its successful trial run, the Horticulture
Express, which is jointly run by the National
Horticulture Board (NHB) and Container
Corporation Limited (Concor), has been
grounded in Concor terminals in North
according to the officials from Concor. The train
has not operated since its trial run on June 18.
To promote horticulture crops, the NHB had
launched a unique initiative in the form of a
'horticulture train'. The first of its kind in the
country, it was built to carry fruits and
vegetables of all types during all seasons in
specially designed containers to ensure proper
ventilation for better shelf life of the produce.
However, the trial runs of the Banana train from
Bhusawal and the Onion train from Kherwadi,
Nashik, failed to fetch goods on their return
journey from the places they were sent to and
hence, no schedules for the rake were drawn
thereafter. As of now, the rake is grounded. The
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Research4India 7
first horticulture train carrying onions from
Kherwadi to Kolkata embarked on its journey
on June 18 this year. The rake had 90
ventilated containers, each carrying about 16
tonnes of onions. The response was good as rail
transport was much cheaper and faster than
transportation by road- which took 120 hours
for the 1,800 km journey at a cost of ` 40,000
per container. Train worked out to be ` 32,000
per container with the distance covered in 36
hours. The response to the first journey was
very encouraging as the produce arrived earlier
and in a much better condition which added to
the value of the product. The officials said that
the hitch with the train was the reluctance of
Banana traders to load the train from Bhusawal.
India may miss target of developing 20 km
a day
India's ambitious target of developing 20 km a
day seems to be an uphill task in the face
financial, regulatory, execution, project
planning and policy challenges faced by the
segment, says Ernst & Young-FICCI report titled
accelerating implementation of infrastructure
projects. As per the report, land acquisition is
one such issue that requires immediate action
for the objectives of the Twelfth Plan being
achieved. Around 70% of the build operate and
transfer (BOT) road projects are facing
inordinate delays in implementation due to
issues related to acquisition of land from the
relevant authorities. There are around 78
projects delayed in road & transport sector
followed by power with 47 and oil & gas with
31.
Currently, country has a road network spanning
41.09mn km and ranks among the largest in
the world. Although, India has a large road
network, in comparison with other countries
(142), it stands at a low rank of 85 in terms of
the quality of its roads. The National Highways
only constitute around 1.7% of the road
network, but carry 40% of the total road traffic.
Yet only 24% of the National Highways are
four-lane and meet international standards.
Railways earnings fall by ` 6.68bn from
April-June target
Despite a hike in freight charges and a partial
increase in upper class fares, the Railways'
earnings have fallen short of the target for the
first quarter of the current fiscal by ` 6.68bn.
Though the Railways earnings have gone up,
they have fallen short of the target for April-
June this year. The Railways earned ` 296.1bn
during the period this year against a target of `
302.7bn. Railways earned ` 242bn in April-June
2011 as compared to ` 296.1bn in the same
period this year, registering 22% growth.
MoFPI has approved 28 cold chain projects
worth ` 6.2bn
According to the statement by Dr Charan Das
Mahant, the Minister of State, Food Processing
Industries(MoFPI), the ministry has approved
28 cold chain projects worth ` 6.18bn. The
MoFPI implements the Scheme of Integrated
Cold Chain, Value Addition & Preservation
Infrastructure (part of scheme of infrastructure
development) and under which it provides
financial assistance in the form of grant-in-aid
at 50% of the total cost of plant and machinery
and technical civil works in general areas, and
at 75% of the total cost of plant and machinery
and technical civil works in difficult areas
including north-eastern states subject to a
maximum of ` 100mn for strengthening and
value addition of cold chain infrastructure.
Indian supremacy in ship-breaking put to
test
The resurgence that one saw in Indian ship-
breaking activities could be short-lived as the
industry in the region is entering another phase
of development, impacted largely by legislative
initiatives of local governments as well as by
market forces. Even though the Indian industry
could recapture the title it lost to Bangladesh as
the largest ship-breaking nation in the world by
recycling 415 ships during 2011-12 , it was not
a profitable year on record. The industry, with
an estimated annual turnover of about ` 100bn,
reportedly lost almost ` 8-10bn during the year
due to rupee depreciation against US dollar. As
the industry is dominated by cash deals,
weakening rupee saw industry profits turning
into losses, since October 2011. Though
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Research4India 8
Pakistan had emerged as the number two ship-
breaking country last year followed by
Bangladesh and China, the ranking is set to
change this year with the resumption of ship-
breaking activities in full form in Bangladesh
from the beginning of the year.
Caravel Logistics Launches India-Mideast
Feeder Link
Caravel Logistics has launched a feeder link
between India and the Middle East. From Port
Pipavav on India’s west coast, the service feeds
into global hub services available at Jebel Ali
port in Dubai. This service from Port Pipavav
would help the company to introduce a new
trade lane and reach out to a larger number of
customers in Gujarat according to Saju Chacko,
MD, Caravel.
Texmaco keen on logistics hub near
Kolkata
Texmaco Infrastructure & Holdings Ltd has
sought permission from the West Bengal
Government for setting up a logistics hub and
food processing park at Sankrail - 10 km west
of the city. Texmaco possesses 141 acres of
land there. The combined project cost for the
logistics hub and food processing park should
be at around ` 4bn. Texmaco Infra has also
planned to raise the capacity of the existing 3
MW mini hydro power project at Neora in
Darjeeling district to 9 MW.
VRL’s Vijay Sankeshwar Bags Transport
Personality Of The Year Award
VRL Logistics Limited, a leading road transport
company, has bagged two national awards in
the recently held CEAT ‘India Road
Transportation Awards-2012’ (IRTA)
presentation ceremony at Mumbai. CEAT India
Road Transportation Awards seeks to reward
excellence and innovative thinking in the
various aspects of road transportation. The
Hubli headquartered VRL Logistics Limited has
been selected for ‘The Best Customer
experience in HTV category’ in the Southern
region. And the Chairman and Managing
Director of VRL Logistics Limited Mr Vijay
Sankeshwar has been honoured with ‘Transport
Personality of the year 2012’ award in recently
held glittering ceremony.
China's rail link to hit Indian exports
The $707mn Yuxi-Mengzi rail line, linking
Kunming in southwest China to Singapore in
southeast Asia, will become operational by the
end of this year, posing a threat to Indian
exporters competing for market space with
China. The rail line, originating in China's
Yunnan province, will traverse through
Vietnam, Laos, Thailand and Singapore,
completing a course of over 2,000km. China
also plans to build rail routes linking Kunming
to Myanmar and, eventually, Bangladesh. On
completion, it will create a grand alliance of
Asian markets supporting each other, while
expanding China's markets. The line will
provide an impetus to trade which has slumped
due to cancellation of purchase contracts by
recession hit West.
Ceva Logistics signs ocean freight
agreement
Ceva Logistics has signed a five-year
agreement with the H. J. Heinz Co. to handle a
large amount of its ocean freight, according to a
news release. The contract represents the first
time that a shipper with an annual volume of
60,000 20-foot-equivalent units has entrusted a
single logistics provider with the exclusive
management of its ocean freight. The benefits
for Heinz (NYSE: HNZ), a global food producer,
include making the supply chain simpler, more
visible and less expensive.
Barloworld intensifies Middle East growth
plans
Barloworld Logistics, a provider of logistics and
supply chain management solutions, has
announced that it is intensifying its growth
plans in the Middle East as the region’s contract
logistics services market expects to sustain a
6.9% compound annual growth rate (CAGR)
from 2011 to 2015, according to a study by
Transport Intelligence. The UAE, Qatar and the
Global News Update
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Research4India 9
Kingdom of Saudi Arabia will remain key growth
catalysts for the contract logistics market in the
Middle East, which is expected to reach a value
of around $3.7bn in 2015, increasing from $3
bn in 2011. Barloworld Logistics predicts that
market conditions will continue to improve in
light of the projected positive growth rates for
the region. GCC countries have posted the
biggest gains in the Middle East contract
logistics market, driven by high levels of
investment, consumer spending and fast
economic growth. Qatar’s contract logistics
market achieved the strongest growth rate in
the Middle East in 2011, expanding by 23.1% to
reach $ 118mn. Saudi Arabia and the UAE, on
the other hand, posted growth rates of 9.1%
and 11.9% respectively during the same period
and remain the region’s largest markets with a
value of $ 630mn and $ 451mn, respectively, in
2011.
Gibson Energy Inc. and GT Logistics, L.L.C.
Announce Joint Venture Discussions
Gibson Energy Inc. (GEI.TO) and GT Logistics,
L.L.C., have announced that they are currently
in discussions the formation of a joint venture
to develop, construct and operate a storage
terminal, to be combined with GTL's recently
completed rail transloading facility with barge
loading capability, for natural gas liquids, crude
oil and other related products. Gibson is one of
the largest independent midstream energy
companies in Canada and a major participant in
the crude oil transportation business in the
United States. GT Logistics LLC is the designer,
developer and operator of the GT OmniPort in
Port Arthur, Texas.
OneLogix eyes niche logistics firms
South Africa based Logistics company OneLogix
Group [JSE:OLG] plans to acquire “small
entrepreneurial businesses” to strengthen its
own operations and give those companies a
growth platform. OneLogix would look at
acquiring “niche logistics” companies. According
to the company a number of its subsidiaries
exceeded targets despite general margin
squeeze from rising input costs and intense
competition. OneLogix reported a 16% rise in
headline earnings per share to 22.1c for the
year to May helped solely by organic growth.
OneLogix’s specialised transport division‚ which
includes its auto logistics businesses‚ reported a
30% rise in revenue to R768.4m. Operating
profit grew 18% to R87m for the period.
China State Shipbuilding Corporation
enters logistics business
One of the largest shipbuilding conglomerates
of China, China State Shipbuilding Corporation
has set up a fully owned logistics subsidiary in
Shanghai. The new operation, CSSC Logistics
Co, is an extension of its purchasing
department, and has been set up with
registered funds of 320mn yuan ($50mn) to
focus on expanding business in sectors
including steel, coal and iron ore, according to
CSSC. The new company is expected to achieve
annual revenues of 70bn yuan by the end of
2015.
Shenzhen Huapengfei Modern Logistics
raises 205.86M Yuan in IPO
Shenzhen Huapengfei Modern Logistics Co., Ltd.
(300350) successfully completed its initial
public offering of 21.67mn A-shares of common
stock at a price of 9.5 yuan per share,
according to filings. The company raised 205.86
mn yuan through the issuance. The shares are
traded on the ChiNext Board of the Shenzhen
Stock Exchange. Shenzhen Huapengfei Modern
Logistics Co., Ltd provides logistics services for
enterprises in the electronic information
industry with its logistics network covering the
major cities across China. The company
provides integrated and customized logistics
services including logistics plan design,
transportation, storage, loading and unloading,
processing, distribution and information
processing. The company has built long-term
business relations with many famous electronic
information enterprises include Lenovo, ZTE,
Foxconn, Huawei, Skyworth, Founder, Toshiba
and Haier.
Logistics Track
Research4India 10
Damco And EBL Create World First
Logistics Hub In Panama
A partnership to promote imports and re-
exports of apparel and fashion between Asia,
the Colon Free Zone (CFZ) and Latin American
destinations was signed by the Panamanian
company Exclusive Brands Logistics Corp (EBL)
and Damco Panama. The logistics deal is the
first of its nature for the fashion industry in
Panama. The hub will handle approx. 35,000
cubic meters of goods per year. EBL is a leading
provider of value-added services, including
packing and labelling, to the fashion and
apparel industry in the CFZ, the commercial
distribution centre located at the Atlantic
gateway of the Panama Canal. Under the
agreement, EBL will provide specialized services
for luxury fashion brands while Damco, the
logistics arm of A.P. Moller–Maersk Group and
one of the world’s leading 3PLs, will provide
supply chain, transportation and freight
forwarding services from source to final
destination.
DHL launches new services to Sweden, UK
Logistics firm DHL Global Forwarding, the air
and ocean freight division of Deutsche Post
DHL, has launched two new services connecting
India with Sweden for exports and with the UK
for imports. According to the company release,
these are strategic countries catering to a large
segment of trade with India. The new direct LCL
services reduce transit time and total carbon
emissions, efficiently bringing wider business
opportunities to India-based customers and
Indian SMEs. These are strategic countries
catering to a large segment of trade with India.
The new direct LCL (Less than Container Load)
services reduce transit time and total carbon
emissions, efficiently bringing wider business
opportunities to India-based customers and
Indian SMEs.
Yusen Logistics set up company in Turkey
Yusen Logistics recently set up a new company
in Turkey to offer air and ocean forwarding as
well as inland logistics including road transport
and warehousing. It is focusing particularly on
the motor industry and retail market. Yugen
Logistics Turkey will commence operations from
1 October. Yusen also sees opportunities to act
as a hub for the developing business networks
in the Black Sea, Mediterranean, Central Asia,
and the Middle East. Amid steady economy,
individual consumption in Turkey is rising and in
the nation’s major industries of automobile
production and electronics, Japanese, US and
European companies are actively operating local
production facilities, gaining from its
geographical advantages. The company will also
tap local geographical characteristics to meet
customers’ needs in rising economies, acting as
a hub for the developing business networks in
the Black Sea, Mediterranean, Central Asia, and
the Middle East.
DHL opens new global logistics hub in
Busan
DHL Global Forwarding, the air and ocean
freight operator of Deutsche Post DHL has
opened a global logistics hub in Korea’s
southern port city of Busan ― the eighth of its
kind globally and first in Northeast Asia. The
Bonn, Germany-based company has injected
500,000 euros ($627,000) in completing the
Busan Multinational Gateway that will reduce
transit times by up to seven days through new
13 direct services. According to some industry
reports, trade between Asia and North America
will grow almost 5 percent in 2013 and over 5%
in 2014. The Busan launch puts us in prime
position to take advantage of the growth
potential. In the coming year, the company also
plans to launch another 20 services to cover
more shipments and regions.
Logistics Track
Research4India 11
Stock Market Update
Share Price Performance
Baltic Dry Index
Road Freight Index
U
As on 31st August 2012 Market Cap Price
(In ` mn) (In `) 1W 1M 3M 6M 12M
Container Corporation of India 121,722 936.45 -1.5% -0.9% 6.3% -3.8% 0.2%
Blue Dart 46,964 1,979.25 -0.3% 0.8% 0.4% 3.8% 21.6%
Great Eastern Shipping 38,331 251.70 -2.5% -3.3% 2.1% 4.3% 5.6%
Essar Ports Ltd. 37,226 87.00 -6.5% -11.2% -2.1% 37.6% 23.2%
Shipping Corporation of India 23,779 51.05 -4.4% -6.8% -0.4% -27.1% -40.5%
Allcargo Logistics 16,701 131.00 0.9% -3.3% 12.3% -4.4% -12.2%
Gateway Distriparks 14,755 136.10 2.9% -4.1% -3.8% -10.4% 0.6%
Arshiya International 6,865 117.60 -6.9% -5.0% -12.2% -19.6% -9.8%
Mercator Ltd. 4,653 19.00 -6.2% 0.5% 12.8% -34.4% -22.6%
Transport Corporation of India 4,624 63.50 0.0% -1.0% 14.1% -6.1% -22.6%
Aegis Logistics 3,975 119.00 -1.2% 5.7% -11.5% -26.0% -36.8%
Sical Logistics 3,725 67.00 0.0% -0.1% -0.5% -2.2% -8.6%
Gati 3,147 36.35 -5.5% -2.3% -4.5% 0.7% -36.5%
SEAMEC Ltd. 2,888 85.20 -2.1% 2.6% 5.9% -9.8% -14.5%
Aqua Logistics 2,775 9.25 -4.6% -11.5% -5.6% -23.2% -36.2%
Varun Shipping 2,198 14.65 -3.6% -4.9% -7.0% -22.7% -27.1%
NSE Nifty - 5,258.50 -2.4% 0.6% 6.8% -2.4% 5.2%
BSE Sensex - 17,429.56 -2.0% 1.1% 7.5% -1.8% 4.5%
ET Logistics Index - 16,493.68 -0.8% -2.8% 4.4% -3.1% -3.7%
ET Shipping Index - 6,168.28 1.2% -2.4% -5.7% -14.1% -19.1%
Baltic Dry Index (BDIY:IND) - 703.00 -2.0% -21.6% -23.8% -6.3% -56.6%
Percentage Change (%)
Source: Baltic Exchange
Source: Transport Corporation of India
Logistics Track
Research4India 12
Financial Benchmarking
Quarterly Results – Q1 FY ’13, ending 30th June, 2012
Figures in Rs.`mn
Annual Results - FY‘12
Figures in Rs.`mn
Q1 FY’12 Q1 FY’13 YoY Q1 FY’12 Q1 FY’13 YoY Q1 FY’12 Q1 FY’13 YoY EBITDA NPM
Aegis Logistics 8,304 14,843 79% 274 (244) - 161 48 -70% - 0%
Shipping Corp. of Ind. 9,727 12,200 25% 1,181 1,624 38% (59) (549) - - -
Mercator Lines 7,992 10,952 37% 1,513 1,750 16% 147 171 16% 16% 2%
CONCOR 9,490 10,369 9% 2,597 2,671 3% 2,342 2,451 5% 26% 24%
Allcargo 8,541 9,752 14% 1,022 1,135 11% 664 556 -16% 12% 6%
GE Shipping 7,280 8,070 11% 3,183 2,879 -10% 1,626 1,810 11% 36% 22%
TCI 4,159 4,574 10% 344 370 8% 134 136 1% 8% 3%
Blue Dart 3,721 4,317 16% 510 574 13% 340 406 19% 13% 9%
Arshiya 2,226 3,418 54% 539 934 73% 236 346 47% 27% 10%
Gateway Distri. 1,978 2,320 17% 635 660 4% 334 352 6% 28% 15%
Sical Logistics 2,058 1,753 -15% 202 220 - 21 14 -34% 13% 1%
Varun Shipping 1,327 1,538 16% 345 937 172% (353) 1,452 - 61% -
Patel Integrated 1,130 1,191 5% 47 45 -3% 12 9 -25% 4% 1%
Aqua Logistics 1,107 773 -30% 91 63 -31% 42 15 -64% 8% -
SEAMEC Ltd 460 737 60% 127 138 - 86 137 - - -
Shreyas Shipping 319 462 45% 21 70 240% (14) 43 - 15% 9%
Gati 2,253 159 -93% 241 (62) - 38 638 1593% - 402%
Essar Ports 70 84 20% 33 12 -63% (213) (179) - 14% -
Company Revenue EBITDA PAT Margins Q1 FY’13
FY'11 FY’12 YoY FY'11 FY’12 YoY FY'11 FY’12 YoY EBITDA NPM
Aegis Logistics 18,129 44,725 147% 833 49 -94% 467 197 -58% 0.1% 0.4%
Shipping Corp. of Ind. 35,434 43,086 22% 7,098 4,644 -35% 5,674 (4,282) - 11% -
CONCOR 38,266 40,609 6% 10,226 10,237 0% 8,301 8,779 6% 25% 22%
Mercator Lines 28,289 36,999 31% 6,385 5,829 -9% 468 206 -56% 16% 1%
GE Shipping 25,580 29,555 16% 9,945 10,804 9% 4,687 3,166 -32% 37% 11%
TCI 18,527 19,553 6% 1,400 1,580 13% 501 595 19% 8% 3%
Blue Dart 11,507 14,954 30% 1,556 1,799 16% 947 1,242 31% 12% 8%
Gati 9,330 12,093 30% 870 988 14% 95 141 48% 8% 1%
Essar Ports 19,408 11,088 -43% 7,667 8,910 16% 702 639 -9% 80% 6%
Arshiya 8,215 10,547 28% 1,580 2,701 71% 820 1,176 43% 26% 11%
Allcargo 6,998 8,263 18% 1,679 2,481 48% 1,211 1,513 25% 30% 18%
Gateway Distri. 6,034 8,235 36% 1,640 2,504 53% 968 1,320 36% 30% 16%
Sical Logistics 5,384 5,015 -7% (45) 341 - 108 133 24% - -
Patel Integrated 4,284 4,524 6% 139 166 20% 32 29 -8% 4% 1%
Aqua Logistics 5,165 3,683 -29% 497 233 -53% 288 83 -71% 6% 2%
Varun Shipping 8,368 3,645 -56% 3,670 888 -76% 147 92 -38% 24% 3%
Shreyas Shipping 1,904 2,708 42% 308 245 -21% 183 56 -69% 9% 2%
SEAMEC Ltd 1,024 1,818 78% (551) 94 - (672) (132) - - -
Company Revenue EBITDA PAT Margins FY’12
Logistics Track
Research4India 13
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