E-commerce to drive logistics sector growth: Report
20-05-2015 00:00:00
E-commerce to drive logistics sector growth: Report
MUMBAI: The booming e-commerce sector in India will drive the $167-billion domestic logistics sector going forward and the introduction of the Goods and Services Tax (GST) which will unify the markets, will be the biggest push for the sector, a report says.

"The matrix of logistics sector is changing due to the increasing focus on e-commerce and express logistics. The domestic e-commerce industry is currently growing at 35- 40 per cent CAGR with large players introducing a dedicated e-commerce logistics business," logistics report by Singhi Advisors, a city-based boutique investment bank that focuses on deals on the space, said.

In recent months, logistics players like Gati, Patel Logistics etc have set up dedicated e-commerce logistics arms and tied up with leading players, the report noted.;

Patel Integrated Logistics, for instance, has set up a special arm called Patel Retail to tap the e-commerce space and tied up with Amazon, an ET report said.

The domestic e-commerce sector was close to USD 20 billion in 2014, up from USD 3.8 billion in 2009. Out of the total, e-tailing itself is over USD 5 billion. It's estimated that by 2030, the e-commerce space will be a USD 300 billion giant, according to industry reports.

Logistics space has been growing at a CAGR of over 16 per cent over the last five years, despite the industry being highly fragmented with organised players being only 6 per cent, the ET report further noted.

Globally, the report said, logistics industry is worth a whopping USD 4-trillion in 2013, representing 10 per cent of global GDP.
-K Ramanathan ram@justransact.com

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