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Lighthouse - November, 2018.

Warehousing in India

Warehousing industry in India is one of the prominent market segments in total Logistic Sector. Implementation of GST & various E commerce as the two important factors that have created significant growth prospects for the warehousing sector in India. Experts claim a total of approximately 43,000 Crore rupees investment scope by 2020 in this sector.
There are various factors which helps warehousing sector to boost to its peak in Indian market.

1. Growing manufacturing activity under “MAKE IN INDIA” campaign driven by current government
2. Rising domestic consumption
3. Increasing International trade
4. Increasing in Organic harvesting
5. Growing investment of Indian & foreign in warehousing infrastructure
6. Ease of Government rules is last but not the least

In present scenario the warehousing industry is approximately 560,000 crore rupees excluding inventory carrying cost which amount to another 4340 thousand crore rupees with a minimum growth of 10% annually. The industry although is facing a lot of difficulties due to improper cargo flows, improper infrastructure, limited capability of carrying capacity so on and so forth.

Industrial / retail warehousing is major contributor in total warehousing industry with its 55% of total market share followed by 14% – 15 % Share by CFS/ICD, Agri warehousing & Cold store.

Industrial Warehousing is approximately 310 thousand crore rupees market with a basic growth of 10-12% in recent past. Some major players in Industrial warehousing are DHL, Safeexpress, Continental warehousing, Indo Arya, All Cargo etc.

Agri warehousing accounts 15% of total market share with an annual growth of 9-10 % in past few years mainly due to growing annual agriculture production, standardized warehousing operations as per Warehousing development & regulation act, subsidy scheme & Tax Incentive. Key players in Agri warehousing are Food Corporation of India (FCI) and Central Warehousing Corporation (CWC). Although 30 % of Agri Warehousing is still operated by unorganized small warehouse owners.

Cold stores accounts of almost 16 % of total warehousing industry and it expected to grow at 15% per annum on a sustained basis over the next 5 years with the organized market growth at a faster pace of 20%. Some significant players are Snowman, Gati Kausar, Cold Star, ColdEx, Kelvin Cold Chain etc.

Last but not the least is Container handling & storage. ICD/ CFS accounts almost 14% of total warehousing market in India and in past 3 years it has grown 10-15 % with almost 90,000 crore rupees market value. Government initiatives, faster container rail transport & secure cargo movement is the main reason for sudden growth rate in containerized movement of Cargo. The government run CONCOR (Container Corporation of India Ltd) continues to be the largest player operating 48 terminals which handles EXIM Cargo while 14 others handle domestic traffic only.
In today’s scenario Warehousing is not only for storage and transport service it is fast emerging as strategic end to end solutions that improves efficiencies with organized & skilled professional services. The fast growth in retail, automotive, manufacturing, pharmacy and agriculture along with GST in India is expected to give a proper thrust in Warehousing & Logistic business.

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