25th September, 2020
Good Afternoon to all of you,
Dear fellow Shareholders,
A warm welcome to each of you to the 39th Annual General Meeting of Arshiya. It is wonderful to have you all join us here today, and on behalf of the Company’s Board of
Directors, I thank you for making the time.
First of all I hope that all of you are well and safe amid the COVID pandemic. I wish everyone good Health.
As Pioneers of this Business, in these unprecedented times, we are looking at constructive ways and means of dealing with the situation, taking care of all our employees, stakeholders and continuously focusing on the everchanging customer. I would further like to state that your Company is classified under essential business and has been working throughout the stages of this Pandemic. Arshiya’s FTWZ in Panvel and Khurja has been operational as per GOI guidelines. Arshiya has ever since been ready to tackle container congestion at ports, without charging ground rent for container storage. It’s my pleasure to bring to your knowledge that Arshiya has been a helping hand to government as much as possible by dealing with removal of container congestion at JNPT/CFS and ICD in NCR & that this gesture has gained much appreciation even from our Foreign Clients; Domestic Clients and port authorities. Since situational readiness is a guarantee at Arshiya, the able team is now ready to partner with interested clients to tackle the pandemic and usher a brighter tomorrow for India and the World. We have looked at ways and means to help the Government and help the communities around us in the best manner. It is your support that strives us to do best.
The Company's accounts for the year ended March 31, 2020, along with the Directors' and Auditors' report and Management's Discussion and Analysis, have already been circulated to you.
My dear fellow Shareholders – let’s understand the INDUSTRY OVERVIEW of our business.
INDUSTRY OVERVIEW
While India’s GDP may not meet its anticipations in 2020, but strong growth supported by government reforms, transportation sector development plans, growing retail sales, and the eCommerce sector are likely to be the key drivers of the logistics industry in India. Online freight platforms and aggregators are on the rise in the Indian logistics market, given the need for low entry barriers and less capital investment compared to setting up of an asset-based business model. Manufacturing in India holds the potential to contribute up to 25%–30% of the GDP by 2025 which will drive the growth of the warehousing segment in India. The logistics market in India is forecasted to grow at a CAGR of 10.5% between 2019 and 2025. It has been awarded infrastructure status which has made it easier for investment inflows and has become a major growth driver of the logistics industry. eCommerce is another major segment which is expected to support growth of the logistics industry during the forecast period.
Within the logistics segment, Third-Party Logistics (3PL), a service that allows a business to outsource operational logistics from warehousing to delivery, is expected to grow the fastest.
Third Party Logistics (3PL) is one of the fastest growing segments in the Indian supply chain market. The 3PL market is divided between traditional 3PL players and new-age, e-commerce centric 3PL players. Despite the hiccups of the past, the future looks positive for our sector and as a significant player in this space, we have started taking steps to capitalize on this growth.
Bright Future ahead
Amidst stern challenges we found great opportunities. Our commitment to our core Company values and business philosophy inspire us to take on the challenges head on. Our focus is to provide world-class integrated logistics and warehousing services in India and globally. In the following paragraphs, I will detail out to you some of our significant plans that will help us achieve this.
It gives me immense pleasure to announce that your Company has completed over 50% of construction of a double storied warehouse on approximately 5.5 acres of land with a leasable area of 3,25,000 square feet at the Arshiya FTWZ in Panvel which is testimony of a new beginning. Also, under the forward sale of development framework the estimated consideration upon monetization of the Warehouse Building is INR 214.9 crores.
At our Khurja facility the Company is in advance stage to monetize one warehouse of approximately 1,90,000 sq.ft of Arshiya Northern FTWZ Limited at its Free Trade & Warehousing Zone. The indicative gross consideration envisaged is Rs. 106 crores.
The Company has realized that the Rail and Inland Container Depot (ICD) section of the Company’s business portfolio is under huge consolidation and the Company doesn’t have the requisite resources to keep pace with the same. In such dynamic and ever changing business horizons, it is wise to exit this section of the business at a reasonable valuation.
Further, the Company has decided to focus on its core competencies of developing, operating and maintaining FTWZ, providing 3rd Party Logistics services (3PL) under an asset light model and the newly ventured Data Centre.
The Company had outlaid plan to set-up an additional segment, i.e., Electronic hardware and software (including information technology enabled services) in the notified area for FTWZ at its Panvel facility wherein Company planned to develop IT/ ITES Park on an area of approximately 25 acres of land. The Company has obtained the requisite approvals to set-up the IT/ ITES Park from the concerned authorities. The requisite 25 acres of land situated at Panvel FTWZ has been notified as IT/ ITES Park and on the said land of the Company plans to build a “Hyperscale Data Centre Park” with a constructible area of approximately 2.5 to 3 million square feet.
With the recent developments and the focused efforts every day we are inching towards our goal of creating overall value for all the stakeholders.
Our People
Our aspirations are ambitious and execution plans bold. Our motivation and commitment to take it forward is founded on the generous guidance and support of our partners, clients, government and last but not the least the tireless efforts of our workforce at all levels. Employee engagement is the main pillar of our growth strategy. I believe that our existing talent pool will enable us to outperform our peers and meet our responsibilities as an organization to all our stakeholders.
I thank you all for your immense support and continued confidence in our Company and Management. I also like to thank all our stakeholders - customers, employees, partners, shareholders, business associates and society at large, for their Continued faith in entire Team Arshiya.
As we plan and work towards making our business more innovative, by reinventing the way we operate, I look forward to your continued support and encouragement to take
our Company to the next level of success and invite you our shareholders, to stay with us as we move forward on this journey.
Thank you,
Ajay S Mittal
Chairman & Managing Director
Arshiya Limited
