sunil shaw tci
DESCRIPTION
Transport corporation of indiaTRANSCRIPT
TRANSPORT CORPORATION OF INDIA LIMITED
SUNIL SHAWENROLLMENT NO-040201133PGDM 2014-16
CONTENT
2
• Logistics industry
• Macro economic environment in India
• Introduction of TCI
• TCI Group
• Industry Dynamics
• SWOT ANALYSIS
• Future Outlook
Logistics industry in India
• The Indian logistics industry is expected to grow annually at the rate of 15 to 20%.
• Logistics spend in India is estimated to be around 13% of the GDP, which is
comparatively higher than other developed countries
• The sector’s contribution to the GDP has been increasing mostly because of the
growing economic developments in the country
• India’s logistics sector attracted huge investments, leaving behind some of the
major sectors including aviation, metals, and consumer durables
Impact of Macro-economic changes on Logistics
DFC/Diamond
Quadrilateral
GST
• Rationalizing the impact of taxes on Production, Distribution and Inventory management
• Consolidation of warehouses and moving towards Hub-and-spoke model
• Multi modal movement between Hubs
• With increased per capita disposable income, consumption driven sectors will grow
• Sectors like Food services, e-commerce, consumable durables etc. will get a boost .E-commerce
driven growth in consumption
• Growth in trend towards outsourcing of logistics in non traditional industries
• Larger scope of outsourcing e.g. order processing, packaging, kitting etc. will go up
Increased outsourcing of Logistics
4
• Creation of additional dedicated rail freight capacity
• Increased bulk multi modal movement for improved productivity & efficiency
• Will result in development of logistic Warehouses in the vicinity of Freight Corridor.
Group TCIKey Facts GST Ready New Warehouse locations
Year ofEstablishment
Turnover
Company Owned Branches
Warehouse Covered AreaVehicles/Day Managed on Road
1958
2.5%
1400+
10.5 Mn Sft
9000
5 new Warehouses (For W/H management only)
One atNagpur
(1.65 lakhs sq. ft.)
Two at Chennai
(45,000 & 8lakhs sq. ft.)
One at NCR(2.5 lakhs
sq. ft.)
One at Hyderaba
d(1 lakhs
sq.ft.)
Movementby Value of India GDP
2800 Cr.
Employees Strength 6000+
5
Group TCISBUs & Services
FTL/FCL, LTL & Over-dimensional cargo services through Road, Rail & Sea.
India’s fastest growing express company for door to door courier and cargo.
A Single-window solutions enabler from Conceptualization to Implementation
Leading player in Coastal Shipping , NVOCC & Project Cargo
Completes the service offering of the Group with connectivity & services across the world at global standards
Other Group Companies & Services
JV with CONCOR to provide end to end multi modal solutions.
TDL undertakes development of the commercial properties of TCI. It also develops large scale Warehouses, Logistics Parks etc.
JV with Mitsui & Co for Auto logistics (Toyota India project)
TCI Transportation Company Nigeria Ltd.
A JV between Indorama Eleme Petrochemicals Ltd. and TCI Global
6
Industry Dynamics and SBU Snapshot
7
IndustryScenario
Mature, Fragmented, Low barriers to entry,
low cost
Growth, niche, high entry barriers,
cost efficiency
Nascent, knowledge based, very high barriers, single
window
Growth, high entrybarriers, low cost
Industry Growth 5-8% 8-12% 15-20% 10-15%
% of Total Revenues
(FY 15-16 Q3)
37%(611 cr.)
29%(483 cr.)
28%(460 cr.)
6%(96 cr.)
TCI EBIDTAMargins
3-5% 8-10% 10-12% 25-30%
Rev. Growth CAGR 5 Yrs.
2.2% 11.3% 19.8% 13.2%
ROCE (5-yrAverage)
11% 46% 25% 17%
ROCE (10-yrAverage)
15% 40% 23% 19%
TCI : Serving the Complete Ecommerce Chain
Customers
Companies
Consolidation center
Warehouses Dedicate & Shared
Suppliers
1. Marketplace
2. Inventory Based
Vi Return To Vendor
~ 200,000units / day
8
~ 150,000Orders / day
~ 20,000Deliveries / day
2. Inventory / Marketplace / Cross Dock- FC
i Receipts and Bar Codin
g
ii Put away and Storage
iii Order processing on SL
A
iv Sortation and Ship
v Return Shipment Mana
gement
1. At Supplieri Supplier
Coordination
ii Scheduling
iii Route optimization
3. At Customer placei Doorstep delivery
ii FOD
iii Reverse logistics
Strengths• Largest integrated road transport player
• providing value added services
• Strong relationship with clients & IT penetration
• Goodwill in market
9
SWOT ANALYSIS
Weakness• Presence in largely unorganised and fragmented
market
• Reliance on spot market for truck availability
• Highly competitive
Threats
• Railways getting more aggressive
• Increasing fuel cost / de-regulation of diesel prices
• Increase in toll rates could reduce margins
• Lower bargaining power with big consignors
Opportunities
• Introduction of GST to boost revenues
• Improvement in sea freight rates
• Very few big players in the market
Entry Barriers: Low
Low capital requirement easy credit availability, low skills / qualification required and ease in obtaining
license.
Entry Barriers: Low
Low capital requirement easy credit availability, low skills / qualification required and ease in
obtaining license.
• Entry Barriers: Low
• Low capital requirement easy credit availability, low skills / qualification required and ease in obtaining
license.
Entry Barriers: Low
Low capital requirement easy credit availability, low skills / qualification required and ease in
obtaining license.
Competition: HighHighly fragmented market
with lack of differentiation in
services
Porters Five Force Model
Growth Drivers
• Warehousing• Consumption driven sector like FMCG, Retail , Auto etc.• E-Commerce
Cost Drivers• Economies of scale• Operational efficiency key to maintain cost control• Receivables management
Macro Drivers
11
• Economic reforms, Implementation of GST and infrastructure investment: Logistics sector to be in higher trajectory.
• Ambitious Capex and expansion plans in current fiscal
Future Outlook
THANK YOU
4