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Motilal Oswal and Redseer reports decipher statistics for logistics industry

Motilal oswa lreport on logistics
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A report recently released by Motilal Oswal gave insight to and deciphered the statistics of the logistics industry for October and November. Overall, the report stated that the logistics activity of the nation fell post-festive season and there was a month to month decline of 17% in e-way bill generation which pulled back the number to 61 million, in November. Although, the report also mentioned that it was a seasonal decline and not to be fret over. The freight rates, despite a dip in the fuel prices, remained uniform, & the demand for logistics slowed in initial days of November but gained momentum by the 2nd half of the month favored by the wedding season.

Shipping

The logistics industry saw a 7% Y-O-Y growth in October pushed by a pickup in industrial activity, traffic at major ports was ‘as usual’ in the month of November. The volumes handles on major ports remained flat (Y-O-Y) at 59 mmt. Ports reporting higher volumes  included Ennore, Chidambaranar, Mumbai and JNPT, while those which reported decline in volumes included Marmugaon, Paradip and Kolkata.

Surface

The capacity utilization of trucks is currently at 80-85% and there was a spike in container traffic, coal, petroleum, oil and lubricants. While on Y-O-Y basis, the e-way bill generation was up by 6%, as compared to October it declined by 17%. E-way bill generations were on the rise for the five months up to October 2021, indicating sustained improvement in truck operations on account of pickup in economic activity and inventory buildup for the festive season.

Rail

Railways witnessed a 5% Y-O-Y improvement in the transportation of EXIM container volumes, though still far from the container cargo movement via the ocean. Domestic container volumes handled by the Railways grew 28 % Y-O-Y in November 2021.

The Redseer report talks about how surface logistics is expected to grow at the compound annual growth rate (CAGR) of 7-8% in the next 5 years. The report enlisted a number of factors for this growth perception including rising income levels, higher exports, rapidly growing e-commerce and an expanding sales market. Redseer’s report also lauds the digital players that are disrupting the sector with innovative business models including startups that give a modern, practical and sustainable solution to the major supply side issues of the economy. According to the report, this is the right time for open marketplace to succeed in wake of many favourable criteria such as heavy investments in surface infrastructure, rapid technology adoption, India’s digital push, macro drivers for fleet owners, and India’s massive on demand or spot market is expected to to drive its growth in the near future.

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