India’s warehousing sector to grow at 18% till 2017

- The warehousing industry in India, valued at INR 745 billion in FY 2013, has been growing at ~15% for the last three years
- The industry will grow to about INR 1,440 billion by 2017
- Growth will be driven by government policy initiatives and greater private sector participation
- The unorganized sector will continue to dominate, currently accounting for 92% of the industry

Supply chain management in India has been lagging behind its peers across the globe. Over the last three years, warehousing has grown at a pace of 15%. The warehousing industry in India was valued at INR 745 billion for FY 2013. Of this, the unorganized sector still holds the dominant share of 92%. Going forward, the industry will grow to about INR 1,440 billion by 2017.

Factors such as the introduction of GST (Goods and Service Tax), the adoption of the PPP model (Public Private Partnership) and the National Policy on Storage and Handling will contribute to the growth of organized warehousing in India. The GST, for example, is expected to be rolled out in the 2014 fiscal. The primary objective of the tax is to remove the cascading effect of ad hoc central and state level taxes. In the case of warehousing, the implementation of GST will reduce the price difference by making all regional tax liabilities the same; and this is likely to lead to a homogenous growth of the industry.

Policy initiatives such as these have led to an interest among private players in the industry. By the end of 2013, private sector companies, such as GATI, Blue Dart, and Adani Logistics, are expected to add 35 million sq ft worth of space, which will be worth approximately INR 27.5 billion. This shows the potential for the industry to grow in the near future.

“Many industry participants have gained a new perspective on the role played by warehousing. It isn’t just four walls and a roof anymore. Now players are adopting new technologies and efficient inventory management to make warehousing more effective. The focus has shifted from reducing costs to increasing profits, and the next 3-5 years will represent a critical inflection point in growth of warehousing,” says Aniket Pargaonkar, Project Manager (Consulting) at ValueNotes.

The report titled Warehousing Industry in India: 2012-2017 takes a look at the industry in depth, including the drivers and challenges for growth, the competitive landscape, analysis on the industry for investor attractiveness, and Porter’s 5 Forces. Key market trends are discussed with their implications and the opportunities and challenges for industry players.

The report on warehousing is the first in the series of ValueNotes’ Short Industry Reports. They will serve as a first reference point to understand key sectors and sub-sectors in India. As a quick-access industry research tool, the reports will provide business decision-makers with a basic understanding of the marketplace and present information on the market size & trends, growth potential, drivers & inhibitors to growth, role of the government, competitive environment, and the country’s challenges.

To learn more about the report, follow this link http://www.valuenotes.biz/knowledge-center/short-industry-reports/warehousing-industry-india-2013-17/, or contact media@valuenotes.co.in

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This release was published on openPR.