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1 5 O C T ’ 1 2 – 2 9 O C T ’ 1 2
Logistics Track 1 No v ’12 For t n ight l y updat e o n L og is t i c s I ndust ry
Research4India is the research services arm of Four-S Services Pvt Ltd, a leading provider of high-end research, financial consulting and Investment banking services. For subscription / custom queries, please contact Seema Shukla at seema@four-s.com
In The Spotlight Contents
DHL lines up ` 7bn investment in India
DHL Supply Chain (DHL) will be investing Euro 100
million or ` 7bn in India to strengthen its logistics
infrastructure in the country. The company will be
setting up multi-client sites in eight Indian cities and
will add five million square feet of warehousing space
in Mumbai, New Delhi and the NCR, Gurgaon,
Bengaluru, Nagpur, Chennai, Kolkata and
Ahmedabad. DHL has also introduced ‘Gurukul’
training centres at its various locations to make sure
it has the required 10,000 people in blue collar jobs
at its locations by 2015. According to Paul Graham,
CEO, Asia Pacific, DHL Supply Chain, India, China and
other emerging markets are expected to be the key
drivers of growth after 2015. With these new
warehouses and our continued investment in people,
DHL was taking another step in the right direction to
pursue its global strategy and support Indian
business and development.
CII-Institute of Logistics partners Hamburg
Chamber of Commerce
Institute of Logistics (CII-IL) inked an MoU with
Hamburg Chamber of Commerce recently. CII – IL
has initiated to set up a Sector Skill Council (SSC) for
Logistics with the support of National Skill
Development Corporation (NSDC). SSC is aimed to
bring in the world class workforce skills to the Indian
Logistics Industry, thereby benefiting the employers,
employees and the country. CII-IL and Hamburg
Chamber of Commerce given their accord to establish
a strategic partnership in the establishment of the
Sector Skills Council of Logistics to the benefit of the
logistics and related sectors in India. The focus areas
for the co-operation include, competency mapping,
quantitative and qualitative studies on the existing
skill gaps, identification of the best technology and
techniques available for skills development and
training of trainers of skill centres.
News of the fortnight 1
Investment Activity 3
News Update 4
Global News Update 7
Stock Market Updates 13
Peer Benchmarking
14
About Four-S Services 15
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
www.research4india.com 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 seema@four-s.com You can also call Ashutosh Sharma at
0124-425 1442, or Devendra Deole at 022-42153659 to book your copy.
Logistics Track
www.research4india.com 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
www.research4india.com 4
Railways revenue up by 25% from freight
traffic in 6 months
Railways have posted over 25% growth during
the first six months of the ongoing fiscal from
the freight traffic. It generated ` 398.8bn from
freight traffic during April-September 2012 as
compared to ` 318.0bn during the
corresponding period last year, registering an
increase of 25.43%. The revenue was earned
from carrying 481.45mn tonnes of commodity-
wise freight traffic during this period as
compared to 459.24mn tonnes carried during
the corresponding period last year. In
September alone, the PSU behemoth earned `
60.0bn, out of which ` 25.0bn came from
transportation of 36.10mn tonnes of coal. It
earned ` 5.2bn from transportation of 8.20mn
tonnes of iron ore for exports, steel plants and
for other domestic user, ` 5.8bn from 8.01mn
tonnes of cement and ` 4.9bn from 3.57mn
tonnes of foodgrains.
Food Park, Cold Chain norms may be
relaxed
The government is planning to revamp its
existing schemes of food parks to promote food
processing industries in the country. It plans to
remove restrictions over the number of food
parks and cold chains inviting more
entrepreneurs interested in setting up food
parks and cold chains. According to the
secretary of food processing industries Rakesh
Kacker, In 11th Five-Year plan, the Govt. had
allocated only 30 food parks out of hundreds of
application received. The ministry proposes to
run two parallel schemes in the 12th Five-Year
plan (2012-2017), one for food parks spread
over 50 acres and other for 30-acre parks. The
government is likely to allocate of ` 140bn for
ministry of food processing industries in the
12th Five-year plan with a significant amount
for the development of food parks. It is
planning to reduce the subsidy amount and split
it into capital subsidy and interest subsidy. At
present a subsidy is up to 50% of the project
cost to the maximum of ` 500mn for food parks
and ` 100mn for cold chains.
Apeejay Infralogistics kick starts
operations at Haldia Logistics Park
Apeejay Infralogistics Private Limited (AILPL), a
50:50 JV of Apeejay Surrendra Group and UK
based Eredene Capital PLC inaugurated the
Haldia Logistics Park after the completion of
phase I and is now ready to kick start its
container freight station (CFS). The total cost of
the project in the first phase is around Rs 95
crore. Haldia Logistics Park is the only
integrated park in eastern India which will
provide one stop facility for all the dry exim
cargo. The first phase of the Haldia Park is
spread over a working area of 45 acres with 24
acres earmarked for CFS to handle over 4000
containers and includes 60,000 sq ft for exim
bonded warehouse. In addition, the Haldia
facility will have 80,000 sq ft for domestic
warehouse, 240,000 sq ft for open storage and
project cargo and over 30,000 sq ft for other
utilities.
Apart from this, Apeejay Infralogistics is ready
to inaugurate its Kalinganagar's logistics park in
December 2012. The facilities at Kalinganagar
under phase-1 will include 120,000 sq ft for
domestic and contract warehousing and
175,000 sq ft for open storage and project
cargo. The first phase of the project will cost `
250mn. The Kalinganagar complex will have a
capacity to handle over 2500 containers for
Exim and will have covered warehouse of over
250,000 sq ft in addition to hospitality,
commercial and retail space. The facility is
equipped with the state's first fully purpose-
built CFS cum transport hub and warehouse
facility specifically targeting the in-bound and
out-bound cargo of the steel and mineral
industry to provide a truly multi modal solution.
News Update
Logistics Track
www.research4india.com 5
Apeejay-Eredene Capital JV to set up nine
logistic parks in India
With its Haldia Logistic Park now thrown open,
Apeejay Infralogistics (AILPL), a 50:50 JV of
Apeejay Surrendra Group and the UK-based PE
fund- Eredene Capital, seems well set to come
up with its second logistic park in the east-
Kalinganagar Logistic Park. The two logistic
parks promise to provide one-stop facility for
dry exim (export-import) cargo and manage
entire supply chain logistics of clients.
The LSE-listed PE fund actually has an
agreement with the Kolkata-headquartered
Apeejay Group to develop nine infrastructure
and logistics projects across the country. The
British PE fund is looking at raising $200-
$300mn from overseas markets to meet its
investment requirement for the Indian
infrastructure sector.
Railways aims at 8-10% YoY revenue
growth
Indian Railways is expecting a year-on-year
revenue growth of 8-10%, according to Union
Minister of State for Railways K.H. Muniyappa.
The Ministerhas said that the need of the hour
was to get aggressive on market-focused
public-private partnership (PPP) models by
engaging rail users in planning process for
tailoring total logistics solutions. The existing
schemes for wagon leasing, sidings, private
freight terminals and container train operations,
and rail connectivity projects will be made more
attractive from rail users’ perspective. This is
because of the limitations of funding support
from the Government and constraints with
regard to internal generation and market
borrowing, he said. The Minister said that the
Railways Vision 2020 estimates the need for
over 5,000 diesel and 4,000 electric
locomotives over the next decade. Stating that
this requires huge investments, he said the role
of private sector and PPP therefore becomes
pivotal.
Tata Capital, Everstone in race for
Transpole Logistics' stake
The Indian logistics sector is turning to be a hot
destination for private equity investors,
following the government's decision to allow
FDI in multi-brand retail. In the latest
development, three PE majors -- Tata Capital,
ChrysCapital and Everstone Capital -- have
joined the race to acquire a significant majority
stake in Delhi-based Transpole Logistics.
Headquartered in New Delhi, ` 5bn Transpole
has a presence across India, China, Hong Kong,
Korea and South East Asia.
According to sources in the know, through the
second round of funding, existing PE investor
Fidelity Growth Partners will make a part exit
from their one-year-old investment in
Transpole. Fidelity had invested about ` 600mn
in April last year by acquiring a significant
minority stake. Through this round of funding,
Transpole is likely to raise about ` 2bn.
Transpole Group was founded by logistics
professionals - Anant Kumar Choudhary, Vivek
Shukla, and Praveen Chand Rai in 2004. The
group had appointed Phillip Ng, ex Managing
Director of Fedex Asia Pacific in 2010 as MD -
Far East, Transpole for driving Asian expansion.
Dimerco, Global Logistics Service Provider,
Operates New India JV
Dimerco Express Group, the global logistics
service provider, announces the official launch
of its India JV - Dimerco Express (India) Pvt.
Ltd. effective from 1st October 2012, marking a
significant milestone on its network expansion
strategy in emerging countries. The new JV
aims at better serving directly to local
customers, and offering a more complete
service network to assist customers global
strategic network planning. Dimerco continues
to strengthen the organization and its
marketing service network in Asia Pacific,
China, North America, Europe & Oceania whilst
cautiously entering into emerging markets in
countries such as India and Brazil.
The new JV started from agency alliance,
subsequently setting up of Dimerco liaison
offices (2007 to 2011), and finally the opening
of the Dimerco JV Company. With an array of
full functional services from international Air
Logistics Track
www.research4india.com 6
and Ocean freight forwarding, warehousing,
distribution to customs brokerage, and with
main office located in Bangalore, Dimerco
Express (India) also serves in Chennai, Delhi,
and another upcoming office to open in
Mumbai.
Cadbury perks up investment in cold chain
Cadbury India is taking steps to increase
investment towards building a cold chain for its
premium chocolate portfolio. After witnessing a
‘worm scare’ in its chocolates a couple of years
ago, it is making sure there are enough visi-
coolers for its premium offerings. In 78,000
stores, cadbury has set up cold chain facilities.
Considering chocolates are more susceptible to
weather conditions and can become a ‘molten
mess’, Cadbury has become more vigilant at its
points of sale.
Logistics, transportation sector require
17.7mn skilled workers, says NSDC
An estimated 17.7mn skilled workforce is
required in the transportation and logistics
sector alone, according to a study by the
National Skill Development Corporation. To
narrow the skill deficit in the sector, the Union
Labour Ministry has floated apprentice training
schemes for mechanics in three trades — two-
and three-wheelers, tractors and motor
vehicles. However, till August 2012, the seats
available in all the three trades had not been
fully utilised. Of the total 532 seats available for
auto mechanic training for two- and three-
wheelers, only 323 were utilised, of the 1,762
seats for tractor mechanic training, only 1,213
were taken, and of the 12,987 seats available
for motor vehicles, only 11,004 had been
utilised, says a Labour Ministry release.
In addition, 133,600 seats are available for a
craftsmen training scheme in 11 trades relating
to transportation and logistics being offered
through Industrial Training Institutes. The
schemes include training in mechanical repairs
and maintenance of various vehicles, such as
marine diesel, heavy and light vehicles, engine
fitters and vessel navigators among others.
However, the Ministry does not have the latest
figures of the number of seats utilised for these
India, Austria sign MoU for shipping, port
infra
India and Austria today signed a memorandum
of understanding (MoU) for technology
cooperation in the shipping and port related
infrastructure, said a government statement.
The MoU was signed by Indian shipping minister
G K Vasan and Doris Bures, Austrian Federal
Minister for Transport, Innovation & Technology
in New Delhi. The MoU is expected to pave way
for sharing appropriate know-how, scientific
knowledge and research and development
capabilities between the two countries. New
technologies for implementation of International
Ship & Port Security code, use of radio
frequency identification in logistics and
transport planning and optical character
recognition in terminals to speed up the
processing of containers in and out are the
areas where Austrian expertise could be utilized
in India, the statement said. Since more than
300 kms of Danube river in Austria is used for
navigation purpose with a well-developed and
regulated inland waterway system their
experience and expertise in the field of inland
water transport would be beneficial to the
development of inland water transport in India,
it said.
Shipping industry to start recovering from
mid-2013: SCI
India’s shipping industry will begin recovering in
the middle of next year as the demand-supply
mismatch of vessels is set to end, said S.
Hajara, chairman and managing director of
Shipping Corp. of India Ltd, the country’s
biggest shipping firm by fleet size. There were
“record deliveries of vessels” in 2010, he said.
But as supply exceeded demand amid a trade
slump, there was a slowdown, said Hajara, who
will step down from his position on 3 December.
He said at the India Shipping Summit that the
demand-supply equilibrium would be restored
by the middle of 2013 and tanker and container
freight will recover fast.
Logistics Track
www.research4india.com 7
Poor freight rates across sectors forced Indian
shipping companies to halt or slow plans to buy
ships. Hajara said ships of high value are being
delivered in a market where the level of income
for such vessels is very low. The domestic
financial environment isn’t conducive to the
funding of ship purchases, said Yudhisthir
Khatau, vice-chairman and managing director,
Varun Shipping Co. Ltd. Indian shipping
companies would prefer to own ships registered
overseas considering the cost of funds and
taxes in India, according to him.
Sri Lanka keen to invest in Indian port
projects
Sri Lanka Ports Authority (SLPA), controlled by
the Sri Lankan government, is in talks with
Indian port companies to form consortiums to
invest in Indian port projects. Some officials of
the Sri Lankan port authority say the company
has already identified projects to invest in India
and is looking to bid for a number of upcoming
projects. This is also the first time that Sri
Lanka has shown willingness to invest in Indian
projects. Industry experts and shipping ministry
officials, however, fear that getting security
clearance for the projects will be tough and
there could be an element of suspicion that Sri
Lanka might try to hamper the growth of the
Indian port sector. Industry experts say that
the move to invest in India should not be seen
as something positive since Sri Lanka remains
India's biggest competitor in the Indian sub-
continent region. According to the existing
policy, the government allows 100% FDI in port
sector, but has barred Chinese companies from
bidding for port projects in the country. Sri
Lanka's port sector, which remains an envy for
Indian ports after the Colombo port emerged as
the largest transshipment hub in the south East
Asian region, was earlier looking for Indian
companies to invest in Sri Lanka. India is
currently Sri Lanka's biggest trading partner,
but China is its biggest donor.
Gautam Chatterjee is DG shipping
In a minor shuffle in the state bureaucracy,
Housing Secretary Gautam Chatterjee will take
over as Director General, Ministry of Shipping,
on central deputation. The Appointments
Committee of the Cabinet approved the
appointment of the 1982 batch IAS officer.
COSCO, China Shipping to jointly operate
trade routes to Fujian
CHINA'S top two shipping giants, COSCO and
China Shipping, will join forces in a move that is
a first for the domestic coastal container
shipping industry and which is aimed at
weathering a severe market downturn. China
Shipping Container Lines Co has said it had
agreed with COSCO Container Lines Co, a unit
of China COSCO Holdings Co, to jointly operate
trade routes from north and northeast China to
Fujian Province and Shantou in south China's
Guangdong Province from mid-October. The
two shippers, with a combined market share of
80% in the domestic coastal container trade,
would each deploy ships to jointly operate the
routes.
China to set off on tanker buying spree for
new shipping venture
State-owned China Shipping is planning to
order up to 20 new supertankers for the fleet of
a joint venture aimed at giving Beijing more
control over its energy supply chain but which
will add to the vessel glut in the struggling
freight market. A Chinese ship buying spree
would provide much needed business to the
domestic shipbuilding market, the world’s
second largest. Hundreds of small to mid-sized
shipyards are teetering on the brink of
bankruptcy as foreign orders dwindle and
domestic lenders slash credit. But any new
vessels will add to an already oversupplied
global shipping market which is struggling with
dwindling clients and falling rates.
Phoenix Petroleum completes acquisition
of ship firm
Publicly listed Phoenix Petroleum Philippines
Inc. has finally completed the acquisition of
Chelsea Shipping Corp. after concluding a
Global News Update
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www.research4india.com 8
share-for-share swap agreement with the
shareholders of the shipping company. Under
the agreement, Phoenix Petroleum acquired
6.3mn common shares, or 100 percent of the
outstanding capital stock, of Chelsea Shipping,
in exchange for 171mn common shares of
Phoenix Petroleum.
In effect, Phoenix Petroleum issued 30 shares
for every piece of Chelsea’s, the oil company
said in a disclosure to the Philippine Stock
Exchange. Both parties did not disclose the total
purchase price, but earlier disclosures placed
the value of the 171mn shares issued by
Phoenix Petroleum at about P1.4 bn. Phoenix
Petroleum earlier explained that 90% of the
quoted purchase price would be paid to the
shareholders of Chelsea Shipping through the
issuance of 171mn new common shares from
the oil company’s unissued authorized capital
stock while the 10% would be paid in cash. As
of end-June this year, the company had a
network of 255 retail stations
EU looks to extend emissions tax to
international shipping
Less than two weeks after the Senate voted
unanimously to pass a bill that shielded U.S.
airlines from paying a European Union
emissions tax imposed on European flights, the
EU is looking to extend emissions taxes to
shipping. European Commission issued a
statement saying they were moving forward
with an effort to reduce greenhouse gas
emissions from international shipping.
According to the EU Commission, they are
considering possible action in 2012 in regards
to including shipping emissions into the EU’s
greenhouse gas emission reduction
commitment. Countries like China and India
have already come out in opposition to the EU
unilaterally imposing an emissions tax on
shipping.
ADB offers loan to China's logistics
industry
The Asian Development Bank announced on
Monday it will loan $24mn to a Chinese logistics
company, its first involvement in China's
logistics sector. The receiver of the loan, Tianjin
Binhai Teda Logistics, will use the funding for a
cold-chain logistics project in Tianjin, a port city
in North China, according to the announcement.
With a total investment of 600mn yuan
($95mn), the main business of the cold-chain
logistics center, located in the Tianjin port area,
includes refrigerated storage, a domestic
shipping and container yard services.
ATI Gets Global Logistics Partner
To deliver optimal and more competitive end-
to-end cargo handling services, Asian Terminals
Inc. (ATI) and global logistics firm CJ GLS
Philippines Inc. (CJ GLS) have recently sealed a
strategic partnership which paves the way for
the collaboration and complementation of their
ports and logistics expertise. Under the MoU, CJ
GLS would tap ATI’s Manila South Harbor and
the Port of Batangas as preferred gateway ports
for the import and export requirements of its
logistics clients. ATI will provide the necessary
logistics support to CJ GLS through its strategic
ports in Manila and Batangas as well as the
Inland Clearance Depot in Laguna. Present in
12 countries, CJ GLS is Korea’s largest global
logistics enterprise for air and sea
transportation, bulk transportation, project
cargo, and express business as well as
import/export, transport, customs, and
warehousing. ATI provides ports, logistics and
other ancillary services through the Manila
South Harbor, Batangas Port, Batangas
Container Terminal, Inland Clearance Depot and
the Sta. Mesa Container Yard in Manila. ATI is
also a strategic partner at the South Cotabato
Integrated Port in General Santos City.
Etihad Rail signs MoU with Global Shipping
& Logistics (GSL), the Dubai-based third
party logistics provider
Etihad Rail – the master developer and operator
of the UAE’s national railway network has
announced the signing of a Memorandum of
Understanding (MoU) with Dubai-based Global
Shipping & Logistics LLC (GSL), a subsidiary of
the Al Shirawi Group of companies and a
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leading third party logistics provider. The
agreement will see GSL use the Etihad Rail
network for cold chain – a temperature-
controlled supply chain – for which rail brings
many benefits. The agreement will offer GSL’s
clients a lower risk cold chain,particularly over
long distances, and with a safer, more efficient,
and more environmentally-friendly mode of
transport than trucks.
Damco buys PacNet to grow presence in
China
Damco, the logistics arm of the Danish shipping
conglomerate AP Moller-Maersk Group, has
agreed to buy the Australian global logistics
company Pacific Network Global Logistics, a
leading freight forwarder in China and Australia
markets, for an undisclosed amount. Damco
said the current PacNet senior management
team will join Damco and the existing
operations will be run by largely the same
people. The move is expected to enhance its
network and forwarding capabilities in Australia
and China and help it gain market leadership
positions in retail and lifestyle sectors in
Australia while further strengthening its position
in airfreight from China to Australia. Damco has
been expanding its presence in the Chinese
market in recent years. In March, the company
said it plans to set up five new offices in West
China, in addition to its existing 19 on the
Chinese mainland. In 2011, Damco increased
its airfreight services through the acquisition of
NTS International Transport Services Co Ltd in
China. In the same year, it also set up a
customer service center in Chengdu, West
China.
Accel-KKR Makes Majority Equity
Investment in Accellos
Accel-KKR, a technology-focused private equity
investment firm, has announced that it has
made a majority equity investment in Accellos,
Inc., the leading supply chain execution
software company focused on the SMB
segment. Accel-KKR is a technology-focused
private equity firm with over $2.3 billion in
assets under management. The firm invests
primarily in software and IT-enabled businesses
well positioned for top-line and bottom-line
growth. Accellos is a global provider of software
solutions specifically designed for the unique
needs of logistics service providers and
midsized businesses. Over 3,000 companies
trust Accellos to be the technology backbone of
their global supply chains. Accellos provides
solutions for warehouse management systems
(WMS), third party logistics (3PL), fleet
management, transportation management
systems (TMS), trading partner integration
(EDI), automated barcode data collection,
parcel shipping, transportation optimization and
supply chain business intelligence.
Logistics developer looks to fund £250m
warehouse portfolio
PointPark Properties (P3) hopes to raise
£250mn through a flotation on the London
Stock Exchange. The proceeds will contribute
towards buying the Arcapita portfolio. The
€760m portfolio is predominantly in West
Europe, mainly in France and Germany, and is
already managed by P3. The deal will also fund
new development in Poland, Czech Republic,
Bulgaria and Slovakia.
APL Logistics to Acquire Chinese Joint
Venture
APL Logistics has signed an agreement with
Legend Holdings Co., Ltd., and Beijing Willway
Information Technology Co., Ltd., to acquire
their shares in APLL-Zhiqin Group, a Chinese
joint venture partnership among the three
parties, by the end of 2012. The third-party
logistics provider expects the deal to speed up
its plans to expand its logistics hub
management and domestic distribution
capabilities in China, as the joint venture’s
transportation and distribution network covers
more than 2,000 locations there, including
third- and fourth-tier cities. After the
acquisition, APL will offer a service network of
78 offices and facilities across China.
Universal Buys Logistics Firm for $335
Million
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www.research4india.com 10
Universal Truckload Services said it has
completed the purchase of third-party logistics
firm LINC Logistics for $335 million. LINC
primarily serves the automotive and
manufacturing industries and provides
truckload, expedited and freight forwarding
services. Universal’s announcement said the
acquisition would add at least 20% to its 2013
earnings. The plan for Universal to acquire LINC
was announced on July 26. Universal Truckload
is ranked No. 39 on the Transport Topics 100
listing of U.S. and Canadian for-hire carriers.
Henderson raises 90mn euros for German
Logistics Fund
Henderson Global Investors has raised €90
million for its German Logistics Fund - a
partnership between Henderson's German
Property Business and Palmira Capital Partner -
giving it €150 million (including gearing) of
firepower to deploy in the German logistics
market. It remains open to further institutional
investors with an eventual target size of €250
million GAV. Current investors comprise
predominantly German insurance companies
and pension funds, together with an Austrian
institutional investor. The fund -Henderson's
second 'Spezialfonds', which will focus
exclusively on existing, good quality logistic
assets in top locations throughout Germany has
already got a number of assets in due diligence,
under exclusivity and hopes to complete on 3-4
acquisitions before the end of the year totalling
€50 million. Its target return is 8.5% with a
40% gearing provision.
Hellmann announces partnership with H.
Essers
One of the leading logistics providers, Hellman
Worldwide Logistics UK, has announced a new
road freight partnership with H. Essers,
Belgium’s leading groupage logistics company.
From September 1st, Hellmann and H. Essers
will launch a new daily shuttle system servicing
both the UK and Belgium. The new network
partnership will be provided in accordance with
System Alliance standards and will link Belgium
and the industrial regions of the UK with a 48-
hour door-to-door service.
Northern France woos India for
investments in rail, logistics
Northern France has invited Indian
businessmen to invest in rail, automotive,
logistics, health, IT and multimedia projects to
take advantage of its strategic location and
proximity to key commercial centres. A
business delegation led by Nord France Invest,
which is the investment promotion agency for
Northern France, during its India visit asked
Indian investors to set up their business there
which is situated in a strategic geographical
location with the key business centres in the
Europe. The region, also known as Lille Region,
already has presence of corporates including
Tata Steel, Titagarh Wagons, ArcelorMittal,
Accord Healthcare, Horizon AI and Blue
Stamping Forging. In 2010, India's leading
wagon maker, Titagarh Wagons had acquired
the assets and business of the financially
stressed French wagons and rolling stock
manufacturer Arbel Fauvet Rail based in Lille
Region. This acquisition is expected to provide
Titagarh Wagons with an additional production
capacity of up to 5,000 wagons per year and in
turn initiate its expansion into European and
global markets. Apart from India, Lille Region is
eyeing to attract investments from countries in
Asia-Pacific region, including Japan, which has
been its historical partner, and China as well as
South Korea.
England Logistics acquires certain assets
of Kampstra
England Logistics, one of the nation’s largest
freight brokerage firms and third-party logistics
(3PL) companies, has announced the acquisition
of certain assets of Portland OR-based
Kampstra Transportation and Logistics LLC.
Through this action, England Logistics will
provide greater service to its brokerage
customers in the Northwest and throughout the
United States. England Logistics is a full-service
transportation and logistics provider with offices
in North America and mainland China. It
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www.research4india.com 11
provides a complete line of transportation
modes including full truckload, less-than-
truckload, intermodal, freight forwarding, and
supply chain management.
DB Schenker opens logistics academy in
China
DB Schenker has opened an academy to train
employees in China. Dr. Thomas Lieb, chairman
of the management board and chief executive
of Schenker has said that by establishing the
DB Schenker Logistics Academy China, the
company was aiming to develop employees
over the long term and keep them at DB
Schenker. DB Schenker has some 5,000
employees in 60 cities in China. The training
programme is geared toward operational
management in contract logistics. Modules
range from logistics concepts and continuous
quality improvement to logistics controlling,
project management and conflict resolution.
Delek Logistics set to raise $160m on
NYSE
Delek Logistics Partners LP, a subsidiary of
Delek Group Ltd. (TASE: DLEKG), controlled by
Yitzhak Tshuva, will seek to raise a gross $152-
168 million in an offering of eight million shares
at $19-21 per share on the New York Stock
Exchange. The company value for the offering
is $456-504mn, after money, with the midpoint
market value of $480 million. Delek Logistics, a
unit of unit Delek Group subsidiary Delek US
Holdings Inc. (NYSE:DK), was established
earlier this year to own Delek US's crude oil and
refined products logistics assets in US
southeast. The company had $888 million in
sales in the twelve months through June 2012.
Delek Logistics will use the proceeds as follows:
$57.8mn will be distributed as a dividend,
$50.9mn will be used to repay bank debts, and
$35mn will be invested in working capital. After
the offering, Delek Group will indirectly own
67.3% of Delek Logistics.
OHL Sells Turbo to XPO Logistics
Third-party logistics provider OHL has sold the
operating assets of freight brokerage division
Turbo Logistics to XPO Logistics. The sale,
valued at $50 million in cash, was OHL's second
this year as part of a strategy to focus on its
core business. In April, it sold off Lanter
Refrigeration Distribution. OHL said it used the
proceeds from the transaction to pay down
long-term debt. CEO Randall E. Curran added
that the move provides “clarity and confidence”
for the company’s stakeholders.
U.S. logistics industry to post 1.1mn jobs
by 2016, report says
The U.S. logistics industry will have nearly
1.1mn job openings between 2013 and 2016
just to keep pace with projected industry
growth during that period, according to a soon-
to-be-released study by a state advocacy
group. The report found that only 75,000
logistics workers are being trained, degreed, or
certified each year to fill what will be more than
270,000 annual job openings through 2016.
Unless the trends change, the nation would be
short about 800,000 qualified logistics workers
by the end of 2016, meaning that nearly 70%
of available job openings would go unfilled.
According to the report, the warehousing and
distribution industry will have more than
125,000 job openings per year over the four-
year period. That is followed by trucking, with
more than 115,000 job openings a year;
industrial engineering, with about 12,000
openings; logistics operations and management
positions at 12,660 per year; and freight rail at
4,530 positions.
IVG raises EUR 120m for logistics fund
Germany's IVG has said that it has raised a
total of EUR 120mn in equity from institutional
investors from Germany and Austria for its IVG
Garbe Logistik fund, launched in March 2012.
By the beginning of next year, IVG and Garbe
Logistic intend to collect more funds and then
close the fund with up to EUR 200 mn in equity
as planned. In total, the fund has a target
investment volume of up to EUR 400 mn and is
expected to be fully invested by the end of
Logistics Track
www.research4india.com 12
2014 at the latest. The first properties will be
acquired this year. Asset management for the
portfolio is performed by Garbe Logistic and
fund management by IVG. Both companies are
also operating as co-investors.
LeSaint acquires Chemical Logistics' assets
LeSaint Logistics has acquired the assets of
Chemical Logistics, a 3PL specialist in
warehousing and distribution of hazmat and
non-hazmat chemicals. The asset acquisition
not only expands LeSaint into the chemical
markets, but also increases quality service
offerings available to customers of both
companies. The two new facilities, which will be
an integral part of LeSaint's supply chain
offerings, will operate under the name of
LeSaint Chemical Logistics. Both the companies
have operations in the USA.
DHL Express launches its $175mn Asia
logistics hub
DHL has opened its biggest express hub in Asia
– the $175m DHL Express North Asia Hub at
the Shanghai Pudong International Airport.
Covering a land area of 88,000 square meters,
the facility is designed to process up to 20,000
documents and 20,000 parcels an hour. The
logistics company also announced plans to
further invest $132m to add eight dedicated
aircraft to service high demand routes between
Shanghai and North Asia, Europe and the US,
by 2014. Stressing its green credentials, DHL
revealed that the hub has energy efficient T5
lighting and a solar-powered system for hot
water. The hub’s sortation system is also
designed to automatically detect components
that are not in use and switches them to an
energy-saving ’sleep’ mode until they are
needed again. The completion of the North Asia
hub adds to DHL Express’s four existing hubs in
Asia Pacific – Shanghai, Hong Kong, Bangkok
and Singapore. DHL said it further plans to
increase capacity on routes between the DHL
Express North Asia Hub and other cities in
China and Taiwan. Over the next few months,
the company will add direct connections to
Incheon, Taipei and Chinese cities such as
Dalian and Qingdao, with Beijing and Xiamen
likely to come on stream in 2013.
Logistics Track
www.research4india.com 13
Stock Market Update
Share Price Performance
Baltic Dry Index
Road Freight Index
As on 26th October 2012 Market Cap Price
(In ` mn) (In `) 1W 1M 3M 6M 12M
Container Corporation of India 130,506 1,004.05 -0.1% 7.7% 13.3% 16.6% 4.9%
Essar Ports Ltd. 41,989 102.30 -3.1% 10.1% 5.1% 12.1% 10.7%
Blue Dart 41,348 1,742.45 -0.4% 1.8% -8.5% -11.8% 10.8%
Great Eastern Shipping 39,144 257.05 0.1% 3.3% -3.7% -1.2% 10.1%
Shipping Corporation of India 23,593 50.65 -7.5% -13.3% 0.3% -15.9% -28.4%
Allcargo Logistics 17,233 132.00 1.0% -2.4% -6.5% 7.7% -8.2%
Gateway Distriparks 15,511 143.05 2.1% -3.3% 0.9% -5.3% -4.4%
Arshiya International 7,479 127.20 -4.8% -1.7% 11.5% -13.1% -21.1%
Aegis Logistics 5,576 166.95 -5.5% 4.8% 50.2% 10.7% -7.1%
Mercator Ltd. 4,812 19.65 -5.5% -8.8% 6.5% -7.3% -23.1%
Transport Corporation of India 4,588 63.15 3.1% 4.2% 6.2% 8.5% -15.1%
Sical Logistics 3,614 65.00 -0.1% 0.2% -3.6% -4.7% -8.0%
Gati 3,074 35.50 -10.7% -13.5% -1.3% 0.1% -36.1%
SEAMEC Ltd. 3,063 90.35 -0.9% -4.1% 6.3% 1.2% -14.2%
Aqua Logistics 2,805 9.35 0.0% 0.0% -4.4% -19.2% -30.7%
Varun Shipping 2,400 16.00 -3.5% 3.8% 8.2% -6.3% -12.3%
NSE Nifty - 5,684.25 -0.4% 0.1% 12.1% 8.9% 8.1%
BSE Sensex - 18,625.34 -0.3% 0.0% 11.9% 8.7% 7.7%
ET Logistics Index - 17,502.18 -0.4% 5.1% 6.0% 7.1% -1.6%
ET Shipping Index - 6,753.89 0.1% 1.7% 9.9% -2.7% -14.0%
Baltic Dry Index (BDIY:IND) - 1,049.00 3.9% 39.5% 9.5% -8.6% -51.1%
Percentage Change (%)
Source: Baltic Exchange
Source: Transport Corporation of India
Logistics Track
www.research4india.com 14
Financial Benchmarking
Quarterly Results – Q2 FY ’13, ending 30th September, 2012
Figures in Rs.`mn
Annual Results - FY‘12
Figures in Rs.`mn
Q2 FY'13
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
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 9,980 8,827 -12% (288) (443) - (193) 370 - - 4%
Gati 3,212 2,983 -7% 401 171 - 45 (78) - - -
Essar Ports 2,740 3,440 26% 2,256 2,828 25% 408 805 - 82% 23%
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% 2%
SEAMEC Ltd 460 737 60% 127 138 - 86 137 59% - -
Shreyas Shipping 319 462 45% 21 70 240% (14) 43 - 15% 9%
PAT Margins Q1 FY’13Company Revenue EBITDA
Logistics Track
www.research4india.com 15
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