Warehouse Industry - India - Sample


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One of the major segments contributing to a rapidly growing logistics industry is the warehousing business. The growth in international trade coupled with the rise in containerization levels has led to high demand for warehouses. This creates tremendous opportunity for the private sector. The market, which is valued at USD 20 bn, is expected to grow due to the demand generated by importers and exporters for specialized services.

The report begins with an overview of the industry indicating market size, growth, current state of the market and the infrastructural resources available. The report highlights various types of warehouses, categorized on the basis of ownership and usage. An analysis of the various investment options available to players entering the market has been provided in order to assist new entrants.
The report covers the various initiatives taken by the government towards the development of warehousing sector including introduction of Single-tax Goods & Services Tax (GST) regime and Warehousing Act 2007, investments in logistics parks and free trade warehousing zones (FTWZs), and development of infrastructural facilities. The report identifies the key characteristics and trends including strong macroeconomic fundamentals, change in tax policy boosting warehouse outsourcing, significant investments by the logistics providers in warehousing segment, entry of realty players and large scale investments from private equity firms.
Competition section profiles major private and public players in the market. The section contains a snapshot of their corporation, future investment outlook as well as their financial performance, providing an insight into the existing competitive scenario.

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Warehouse Industry - India - Sample

  1. 1. Warehousing Industry - India July 2009
  2. 2. Executive Summary <ul><ul><li>Estimated worth INR XX bn in 2007-08; Expected to reach INR YY bn by 2010-11 </li></ul></ul><ul><ul><li>Warehousing accounts for a% of the total logistics market </li></ul></ul><ul><ul><li>Major warehousing destinations are A,B,C and D </li></ul></ul><ul><ul><li>Warehouses can be classified as - public, private and bonded </li></ul></ul>SAMPLE Market Government Initiatives Trends Major Players <ul><ul><li>Shift to GST tax regime </li></ul></ul><ul><ul><li>The Warehousing Act, 2007 </li></ul></ul><ul><ul><li>Private investment in logistics parks and FTWZs </li></ul></ul><ul><ul><li>Infrastructural developments </li></ul></ul><ul><ul><li>Development of the dedicated freight corridor </li></ul></ul><ul><ul><li>Strong macroeconomic fundamentals </li></ul></ul><ul><ul><li>Changing tax policy boosting warehouse outsourcing </li></ul></ul><ul><ul><li>Most profitable segment in logistics leading to large scale investments </li></ul></ul><ul><ul><li>Realty players foraying into the market </li></ul></ul><ul><ul><li>Large scale investments from private equity firms </li></ul></ul><ul><ul><li>The market is fragmented with b% of the market comprising of the unorganized sector </li></ul></ul><ul><ul><li>u-v% of the organized market is accounted for by PSUs </li></ul></ul>PSU’s Private Players <ul><li>Company 1 </li></ul><ul><li>Company 2 </li></ul><ul><li>Company 3 </li></ul><ul><li>Company 4 </li></ul><ul><li>Company 5 </li></ul><ul><li>Company 6 </li></ul>
  3. 3. <ul><li>Market Definition </li></ul><ul><li>Market Overview </li></ul><ul><li>Government Initiatives </li></ul><ul><li>Industry Characteristics & Trends </li></ul><ul><li>Major Players </li></ul><ul><li>Key Developments </li></ul><ul><li>Appendix </li></ul>
  4. 4. Warehouse industry is estimated to grow at an accelerated rate in accordance with the growth in trade and commerce SAMPLE Overview Major Warehousing Destinations Source: u 07-08 v 08-09 w 09-10 x 10-11 y USD bn m% Warehousing n% Other Logistic Segments f ’ 12 c ’ 10 d ’ 11 e mn MT a b 2008 ’ 09 Market Size and Growth Capacity Expansion Warehousing expected to account for L% logistic activity by 20 - - <ul><li>Warehousing in India is estimated to account for approximately z% of total logistics costs </li></ul><ul><li>The current state of warehousing is dismal: </li></ul><ul><ul><li>Inefficient facilities </li></ul></ul><ul><ul><li>Lack of technology </li></ul></ul><ul><ul><li>Shortage of expertise </li></ul></ul><ul><ul><li>Small and distributed across states primarily due to the tax structure </li></ul></ul><ul><li>Fundamental demand is very strong leading to large investments and expansion by logistic service providers and warehousing companies </li></ul><ul><li>Market is estimated to grow at y% p.a. </li></ul><ul><li>The Government’s 11 th Five Year Plan targets a capacity of XX MT by 20-- </li></ul><ul><li>Competitive landscape is dominated by state-owned companies although private participation is also growing significantly </li></ul>
  5. 5. The government has taken strong initiatives and implemented various policies for the development of this sector <ul><li>Major transition from Central Sales Tax to the existing VAT regime coupled with the introduction of Single-tax Goods & Services Tax (GST) allowing for the lower logistics costs </li></ul><ul><li>Expected to lead to large warehouses offering various services via integration of technology </li></ul>Shift to GST tax regime Key Initiatives Warehousing Act <ul><li>The Warehousing Act, 2007 introduced a negotiable warehouse receipt (NWR) system </li></ul><ul><li>NWR’s are expected to facilitate FI’s as it provides cost advantages and eases trade procedure for players </li></ul>Development of the Dedicated Freight Corridor <ul><li>Government plans to create a dedicated rail freight corridor along the east and the west </li></ul><ul><li>Private participation is expected for developing modern logistics facilities and services </li></ul>Infrastructural Developments <ul><li>Impetus has been on developing road infrastructure to support road freight </li></ul><ul><li>Golden Quadrilateral and NSEW (North-South-East-West) Road Corridor are two major initiatives forwarded by the government </li></ul>Private Investment in Logistics Parks and FTWZs <ul><li>Government has been encouraging private players to develop logistics parks and Free Trade Warehouse Zones in order to boost this sector by drawing in large scale investments </li></ul>
  6. 6. Key Trends Strong macroeconomic fundamentals Realty players foraying into the market Most profitable segment in logistics leading to large scale investments Changing tax policy boosting warehouse outsourcing Large scale investments from private equity firms Trends
  7. 7. Government Players (1/2) SAMPLE Corporate Information Business Highlights u 2006-07 v 2007-08 Revenue Profit / Loss Revenue INR mn Profit INR mn Source: <ul><li>Provides storage facilities for a wide range of products, from agricultural to industrial goods </li></ul><ul><li>It has a market share of t% (2008) </li></ul><ul><li>The company handled x TEUs in ’08 against y TEUs handled in the previous year, registering a growth of z% at their CFSs / ICDs </li></ul>Financial Performance <ul><li>Expansion: Plans on expanding existing warehousing capacity in Kerala by a tonnes in 20-- - -- </li></ul><ul><li>MOU: Formed an association with the Ministry of Consumer Affairs, Food & Public Distribution for creating additional storage capacity of b MT </li></ul><ul><li>MOU: With C as it plans to set up a modern state-of-the art CFS facility near the D Port </li></ul>Business Outlook Company Snapshot: Company 1 Established 19-- Headquarters Mumbai Capacity A Location B warehouses Key People <ul><li>C (Chairman and MD) </li></ul><ul><li>D (Chairman and MD) </li></ul><ul><li>E (Joint Secretary) </li></ul>
  8. 8. Thank you for the attention About Netscribes Netscribes is a knowledge-consulting and solutions firm with clientele across the globe. The company’s expertise spans areas of investment & business research, business & corporate intelligence, content-management services, and knowledge-software services. At its core lies a true value proposition that draws upon a vast knowledge base. Netscribes is a one-stop shop designed to fulfil clients’ profitability and growth objectives. The Warehousing report is a part of Research on India’s Logistics Industry Series. For more detailed information or customized research requirements please contact: Disclaimer: This report is published for general information only. Although high standards have been used the preparation, Research on India, Netscribes (India) Pvt. Ltd. or “Netscribes” is not responsible for any loss or damage arising from use of this document. This document is the sole property of Netscribes (India) Pvt. Ltd. and prior permission is required for guidelines on reproduction. Natasha Mehta, CFA Phone: +65 8448 0449 E-Mail: [email_address] Gagan Uppal Phone: +91 98364 71499 E-Mail: [email_address] Research on India is a product of Netscribes (India) Pvt. Ltd. Research on India is dedicated to disseminating information and providing quick insights on “hot” industries in India and other emerging markets. Track our new releases and major updates in these industries on