We are delighted to present to you the first Annual Report of your Company - MahindraLogistics Limited (MLL) since its Initial Public Offering (IPO). The financial year2017-18 has been important and eventful for your Company as it successfully listed on thestock exchanges through its IPO. I am pleased to welcome all our new shareholders andthank them for their whole-hearted support to our IPO.
During the financial year MLL continued its strong performance reporting consolidatedrevenues of Rs. 3416 crore for the financial year ended FY'18 a growth of 28% incomparison to the previous year. Your Company also recorded its highest ever profitsduring the year under review. In FY'18 the profit after tax stood at Rs. 65 croreregistering a year-on-year increase of 42%. Our freight forwarding business has also seena phenomenal growth during this period.
With the successful implementation of GST your Company took possession of twomulti-product multi-user warehouses in Tauru Road Gurgaon and Chakan Pune. Keeping upwith our continuous innovations in technology during this period we have developed astate-of-the-art last-mile optimisation software & account receivable managementsystems for high visibility efficiency & responsiveness. Your Company stronglybelieves that its growth is directly linked to enhancing the skills of its workforce. Weare happy to inform you that a total of 15000-)- man-days of training has been carried outduring this period. In addition to this we have started training both MLL and otherdrivers under the Pradhan Mantri Kaushal Vikas Yojana (PMKVY). Our target is to train10000 drivers across India in FY'19.
The Indian logistics sector is large but fragmented. According to CRISIL the share oforganised Third Party Logistics companies is around 5% of the overall market. However theyear 2017-18 was a remarkable year for the logistics sector as many key structuralreforms were rolled out which are likely to have a very significant impact on the sector.
a. GST is a game changer for India's economy and the logistics sector. Despite initialimplementation challenges this policy change will have a profound impact on the supplychain across industries.
b. The Logistics sector has been awarded Infrastructure status which will prove verybeneficial for the industry. In addition to this the appointment of a Logistics Secretaryand the launch of infrastructure projects like Bharat Mala Sagar Mala Udan Multimodallogistics parks etc will provide further impetus to the sector.
c. The implementation of e-way bill a major procedural change being rolled out by thegovernment and the initiative to set up a National Logistics Portal by the Department ofCommerce will significantly enhance the efficiency and transparency within the logisticssector.
Your Company has been at the forefront when it comes to implementation of theseinitiatives which will provide momentum to the logistics industry. These will reduce thecost of logistics in the country and should also boost India's rank in the LogisticsPerformance Index (LPI). At MLL we believe that "Move in India" is a criticalrequirement for "Make in India" to succeed.
Path ahead rMul'
The past year has seen more reforms and positive changes for the logistics sector thanthe earlier decade. Looking ahead the industry in general and your Company in particularare both likely to undergo significant transformation.
a. Today the logistics industry in India is highly fragmented and unorganised. Howeverthe share of 3PL companies in the sector is poised to expand substantially and as one ofIndia's leading 3PL companies we hope to play a transformational role in helping theindustry become more organised.
b. Customers' expectation from 3PL companies are also poised to increase further. Ascustomers increasingly focus on their core activities and increasingly outsource theirlogistics services to subject-matter experts like MLL they will seek comprehensive andefficient solutions. This trend offers MLL the opportunity to exploit the emergingpotential and further expand and deepen our service offerings to our customers.
c. In light of these industry tailwinds the Company plans to continue its focus onincreasing our acquisition of third party non-Mahindra Group clients as also throughincreased penetration across the entire client portfolio.
d. We see technology as a major enabler in our plans for growth and going forward wewill continue to enhance both internal operations and customer facing processes byeffectively leveraging technology.
e. At MLL we will continue to operate on an asset-light model and strengthen ourrelationship with our business partners to enable continuous growth.
Rise For Good
From our employees to the society at large we see an incredible opportunity to drivepositive change for all our stakeholders re-affirming our commitment to create a betterworld. In everything we do we consciously aim to Rise for Good a fact that is clearlyevident in our purpose statement - Accelerating Commerce Empowering Communities to RISE.
As part of our Corporate Social Responsibility (CSR) initiatives your Company hasundertaken projects in the areas of Rural Development Road Safety Health andEnvironment creating substantial benefit for stakeholders and communities.
I take this opportunity to acknowledge the efforts of every one of our employees fortheir contribution dedication and commitment which has resulted in MLL emerging as apreferred name in this industry. My gratitude to our clients for continuing to reposetheir trust in our Company. The engagement and goodwill we enjoy with all our BusinessPartners is an invaluable ingredient of our continued growth and requires our specialacknowledgement.
The Government and various industry bodies have played a significant role in oursuccess with their forward-thinking policies which have also provided further momentum tothe industry.
In closing my thanks to all our stakeholders for their undivided interest supportfaith and encouragement over the past year. We look forward to continuing our strong andenduring partnership with them to help us achieve new milestones in the year ahead.
|Warm Regards Zhooben Bhiwandiwala