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Forecast of the market of transport and logistics services in India

Release date 26.05.2022

Number of pages 60

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The relevance of research

The main task of logistics is planning the optimal territorial (or geographical) placement of the required materials and raw materials to meet the needs for them and for the smooth operation of organizations. It is worth noting the importance of the functioning of logistics companies, because with the help of a certain set of tasks facing specialists, it is possible to achieve maximum optimization of the transport service, as well as maximize profits by minimizing possible costs.

Purpose of the study

Forecast of the state of the market of transport and logistics services, assessment of the market size, analysis of competitors, as well as identification of factors affecting the market of transport and logistics services

Content

Chapter 1. Key components of the transport and logistics services market

1.1. Market size

1.2. Growth rates of the market of transport and logistics services

1.3. Trends in the market of transport and logistics services

1.4. The main problems of the industry

1.5. Stage of the life cycle of the market of transport and logistics services

1.6. Estimation of the number of buyers and their financial capabilities

1.7. Estimated consumption per capita

1.8. Analysis of sectoral indicators of financial and economic activity

1.9. Price analysis

Chapter 2

2.1. Economic components

2.2. Social Components

2.3. Technological components

2.4. Political Components

2.5. STEP-analysis of the market of transport and logistics services

Chapter 3. Assessment of the degree of competition

3.1. Scale of competition (local, regional, national, global)

3.2. Number of competitors and relative market shares of the largest competitors

3.3. Compact location of industry companies in certain regions

Chapter 4 Industry Forecasts

4.1. Analysis of the impact of recent crises on the industry (the global crisis of 2008 and the currency crisis in India in 2014)

4.2. Analysis of the impact on the state aid industry at the current date

4.3. Assessment of the extent of the impact of the crisis on the analyzed market. Barriers existing in the market of transport and logistics services

4.4. Prospects and growth drivers for the transport and logistics services market

4.5. Forecast of the development of the market of transport and logistics services in the current economic crisis

Chapter 5 Forecasting Methodology

5.1. Methods for forecasting key industry indicators

5.2. Sources of information for forecasting

5.3. Timing of forecasting

Research excerpt

Chapter 1. Key components of the transport and logistics services market

1.1. Market size

Logistics is a science that studies the planning, management and control of warehousing, delivery, movement of material flows in the process of delivery, processing and bringing finished products to the buyer.

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Diagram 1. TLU market structure, 2021, %

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The Indian market of transport and logistics services is characterized by the following features:

1.2. Growth rates of the market of transport and logistics services

Consider the dynamics of the volume of the market of transport and logistics services in India.

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Diagram 2. Volume of the transport and logistics services market, 2017–2021, billion Rs.

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1.3. Trends in the market of transport and logistics services

Currently, experts identify the following trends and trends in the development of the transport and logistics services market:

The current situation in the world and in India at the beginning of 2020 contributed to the development of the following trends for 2020–2021:

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1.4. The main problems of the industry

Despite the growing demand for transport and logistics services, there are quite serious problems on the market. The existing infrastructure is no longer able to meet the needs of the economy. A significant part of the infrastructure is out of order, has become technically unusable, morally obsolete. Most of the railway fleet, aircraft and river vessels have reached their maximum service life. Depreciation of fixed assets of river ports is …%., airport network - …%.

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The main problems of logistics in transport that appear on the way of its development:

inefficient use of routes for the delivery of goods from the supplier to the consumer;
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Thus, the development of the market of transport and logistics services in India is lagging behind the developed countries.

1.6. Estimation of the number of buyers and their financial capabilities

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The most important factors influencing the TLU market have always been economic factors: the purchasing power of the population, production, investment climate.

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According to Rosstat’s preliminary estimate, the annual GDP growth rate in the first quarter of 2022 amounted to …%. The estimate is based on the value added generated by large companies in all sectors of the Indian economy and on the ""net"" taxes indicator. The result of Rosstat turned out to be slightly worse than the estimates of the Ministry of Economy ...

1.7. Estimated consumption per capita

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1.8. Analysis of sectoral indicators of financial and economic activity

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Gross margin is gross profit divided by sales revenue (excluding excise taxes and VAT). Gross margin shows how much gross profit falls on a unit of revenue. Gross profitability serves as an assessment of the economic efficiency of an enterprise, which reflects the rational use of labor, material, monetary and other resources.

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The profitability indicator before tax at the end of 2021 showed a positive trend in the areas of sea, rail, air and road cargo transportation, as well as in the field of warehousing and storage. In all other areas, there was a decrease in the values of the indicator.

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Current liquidity

Values of current liquidity in the industry in 2017–2021 were oscillatory.

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Absolute liquidity

The industry of transport and logistics services as a whole in 2021 has absolute liquidity indicators comparable to those for all sectors of the Indian economy, with the exception of postal services and courier activities, where the coefficient value is … times.

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Financial stability

Financial Strength Indicators 2019–2021 in the industry as a whole were both above and below the normative value (…%). The value of the financial stability indicator above …% indicates a sufficient amount of working capital in the industry, necessary for its financial stability.

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1.9. Price analysis

Payments for services rendered by transport organizations are carried out using transport tariffs. Tariffs include:

the fee charged for the carriage of goods;
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For railway freight transport services, the maximum increase in the cost of freight transportation was noted in 2016 (by …%), and the minimum - in 2020 (by …%). At the end of 2021, the cost of transporting goods by rail increased by …%.

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Chart 7. Average prices for freight transportation, 2016–2021, Rs./t.

Chapter 2

2.1. Economic components

GDP is a macroeconomic indicator that reflects the market value of all final goods and services (that is, intended for direct consumption) produced per year in all sectors of the economy on the territory of the state for consumption, export and accumulation, regardless of the nationality of the factors of production used.

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Among other positive factors, Reshetnikov named a smaller-than-expected decline in investment, a recovery in consumer demand for goods and services, and stabilization in the labor market. At the same time, according to the head of the Ministry of Economic Development, the OPEC + agreement on limiting oil production has a restraining effect on the economic recovery.

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Rosstat presented a preliminary estimate of GDP for the first quarter of 2022, made by the production method. The index of the physical volume of gross domestic product in Q2022 2021 relative to the corresponding period in , according to preliminary estimates, amounted to …%.

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Also, one of the factors of pressure on GDP can be called the deterioration of the price environment in the commodity markets. Chart 9 shows the dynamics of the US dollar against the rupee.

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The industrial production index shows the total volume of all industrial production, utilities, etc. in monetary terms.

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inflation rate. Inflation in 2019 (…%) took the second place in the entire history of observations - it was lower only at the end of 2017 - …% (against the backdrop of a record harvest).

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Chart 10. Dynamics of the inflation rate in India, 2016–2022 (4 months), %

Retail trade volume during 2016–2021 constantly increased. At the same time, starting from 2017, the growth rate of the indicator increased. At the end of 2020, the volume of retail trade amounted to … trillion Rs., which is only …% more than the figure for the same period in 2019. In 2021, the volume of retail trade increased by …% to … trillion Rs.

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2.2. Social Components

During 2012–2018 India's population is on the rise. The increase in the population in 2015 was not only due to migration and natural increase, but also due to the formation of two new states of the Federation - the Republic of Crimea and the city of Sevastopol.

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The real disposable income of Indians in January-March 2022 decreased by …% compared to the same period last year. The previous decline was recorded a year ago.

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2.5. STEP-analysis of the market of transport and logistics services

In general, the impact of macro factors on the market of transport and logistics services can be assessed as moderately negative. A group of economic and social factors has a negative impact. In addition, two technological factors are negative (low level of staff qualifications and rising prices for fuels and lubricants and spare parts), as well as tightening regulation of the industry, world politics and anti-Indian sanctions.

Positive influence is exerted by such factors as state. industry support, licensing, credit policy, transport strategy, road improvement, and IT implementation.

Table 17. STEP-analysis of factors affecting the market of transport and logistics services

Chapter 3. Assessment of the degree of competition

3.1. Scale of competition (local, regional, national, global)

The global market for transport and logistics services has been developing steadily over the past 20 years. Various methods and schemes of work are emerging - from multimodal transport services to distribution centers with complex technologies for bundling and pre-sale preparation of commodity flows, management of distribution channels and communication infrastructure. Among the leading market players there are both transport companies and management companies of distribution centers. These are Tibbet&Britten, TNT, Geodis, Schenker.

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3.2. Number of competitors and relative market shares of the largest competitors

The level of competition in the TLU market is currently assessed as high. There are about 4 thousand players on the market. Competition among the main market players continues to intensify. At the same time, not only for customers, but also for highly qualified staff.

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Chapter 4 Industry Forecasts

4.1. Analysis of the impact of recent crises on the industry (the global crisis of 2008 and the currency crisis in India in 2014)

In 2020, the Indian economy faced three obstacles at once - falling oil prices, a self-isolation regime and a decrease in demand for Indian exports.

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4.2. Analysis of the impact on the state aid industry at the current date

In the context of the economic crisis and the coronavirus pandemic: the Government Commission on Improving the Resilience of the Indian Economy, chaired by First Deputy Prime Minister Andrey Belousov, approved a list of sectors of the economy most affected by the deteriorating situation due to the spread of a new coronavirus infection, to provide priority targeted support.

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4.5. Forecast of the development of the market of transport and logistics services in the current economic crisis

An economic crisis is a profound disruption of normal economic activity, which is accompanied by the destruction of habitual economic ties, a decrease in business activity, the inability to repay debts and the accumulation of debt obligations.

List of diagrams and figures

Diagram 1. TLU market structure, 2021, %

Diagram 2. Volume of the transport and logistics services market, 2017–2021, billion Rs.

Diagram 3. Freight turnover dynamics, 2017–2021, bn t*km

Diagram 4. Dynamics of cargo transportation, 2017–2021, million tons

Figure 5. Stage of the life cycle of the TLU market

Diagram 6. The volume of consumption of transport and logistics services per capita, 2017–2021, Rs./person

Chart 7. Average prices for freight transportation, 2016–2021, Rs./t.

Diagram 8. Dynamics of India's GDP, 2015–2021, % to the previous year, trillion Rs.

Chart 9. Monthly dynamics of the US dollar against the rupee, 2017-2022 Apr. yrs., Rs. for 1 US dollar

Chart 10. Dynamics of the inflation rate in India, 2016–2022 (4 months), %

Chart 11. Retail trade volume in India, trillion Rs., 2015–2021

Diagram 12. Dynamics of the population of India, as of January 1, 2012–2022, million people, thousand people

Chart 13. Dynamics of real incomes of the population of India, 2015-2021

Diagram 14. Dynamics of the average interest rate on loans, 2015–2021, %

Diagram 15. Global TLU market, 2010–2021, billion US dollars

Figure 16. Basic scheme of interaction between TLU participants

Diagram 17. Shares of the largest competitors in the market of transport and logistics services in 2021

Chart 18. Dynamics of the total revenue of the largest market operators from the provision of transport and logistics services (TOP-5) in India, 2017–2021, billion Rs.

Diagram 19. Structure of the transport and logistics services market in India by Union Territories, %

Diagram 20. Forecast of the volume of the market of transport and logistics services in 2022–2026, billion Rs.

List of tables

Table 1. Structure of the market of transport and logistics services, billion Rs.

Table 2. Gross margin of the transport and logistics services industry in comparison with all sectors of the Indian economy, 2017-2021, %

Table 3. Profitability of profit before tax (profit of the reporting period) in transport and logistics services in comparison with all sectors of the Indian economy, 2017–2021, %

Table 4. Current liquidity (total coverage) in the field of transport and logistics services for 2017–2021, times

Table 5. Absolute liquidity in the field of transport and logistics services in comparison with all sectors of the Indian economy, 2017-2021, times

Table 6. Business activity (average turnover period of receivables) in the field of transport and logistics services, for 2017–2021, days days

Table 7. Financial stability (security of own working capital) in the field of transport and logistics services in comparison with all sectors of the Indian economy, 2017–2021, %

Table 8. Consumer price indices for freight transportation by all modes of transport (excluding pipelines) by states of India, 2016–2021, %

Table 9. Consumer Price Indices for Rail Freight Transportation by State of India, 2016–2021, %

Table 10. Consumer Price Indices for Freight Transportation by Road by Indian States, 2016-2021, %

Table 11. Consumer Price Indices for Freight Transportation by Sea by Indian States, 2016-2021, %

Table 12. Consumer price indices for freight transportation by inland waterways by states of India, 2016-2021, %

Table 13. Air Freight Consumer Price Indices by Indian States, 2016-2021, %

Table 14. Industrial production index by state of India (in % of the previous year), 2015-2021

Table 15. Dynamics of rolling stock, 2014–2020, thousand units

Table 16. Weighted average interest rates of credit institutions on credit operations in rupees, excluding PJSC Sberbank (% per annum), 2015–2021

Table 17. STEP-analysis of factors affecting the market of transport and logistics services

Table 18. Main companies participating in the market of transport and logistics services in 2021

Table 19. Assessment of the impact of recent crises on the industry

Table 20. List of sectors of the Indian economy most affected by the deterioration of the situation as a result of the spread of a new coronavirus infection

Table 21. Analysis of the impact on the industry of the state aid proposed to date

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