SHREYAS PPT

8/7/2019 SHREYAS PPT

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Shreyas shipping and logistics


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Past strategies of the company:

On Febuary 15 2006, shreyas shipping signed aMemorandum of Agreement (MOA) for purchaseof fully cellular ship at a cost of Rs. 60 crore, in abid to augment its fleet strength.

Shreyas shipping ventures into logistics in 2007:Shreyas is the only shipping company in India that

caught the fancy of logistics space. It changed its

name from shreyas shipping to shreyas shippingand logistics and formed a wholly owned

subsidiary for logistics.


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The logistics sector holds huge potential in the

context of containerisation of cargoes growingaround 30 to 35 per cent in India.

It offered a door to- door solution where the

client is assured of safety, reliability, speed andeconomy, and multiple handling of cargo is

avoided leading to zero pilferage, damage and

loss to the cargo.


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Fall out of strategies

Venturing into logistics failed to gather more of

shipping:

Reasons:

a. Land logistics offered better margincompared to shipping.

b. When revenues from logistics grew by 127.62

per cent in FY07 to the total revenues of

Shreyas, shipping posted a negative growth of

17.17 per cent.


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c. Profit from logistics witnessed 75.96 per

cent growth while shipping posted 41.32 percent growth.

d. If the shift from shipping into logistics was

not made, the profit before tax (PBT) for

Shreyas Shipping would be only Rs. 23.80

crore when the present PBT was Rs. 30 crore.


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STRATEGIES???

(DID THEY WORK, DID THEY NOT?)

The strategy of venturing into logistics worked asthe company was diversified and insulated fromthe vagaries of the shipping market.

Though shreyas earned greater revenues fromlogistics as compared to shipping, in the year

2008, the company re-balanced its revenuestreams with income from logistics which

accounted for 75% of the total operating income(as against 63.90%) and the balance 25% wasaccounted for by shipping operations (as against36.10%).


7/15

The shipping business is a strong companion

to the logistics activity which filled up the gap

in the supply chain and improvised it. The

company thereby embarked on crafting tailor

made logistics and transportation solutions

and handling distribution packages forvolumes moving from one part of India to

another and also to neighbouring countries in

the SAARC region.


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Shreyas used its accumulated experience in

operating feeder services to pioneer coastal

transhipment services within India thereby

connecting Indian ports to each other for the

purposes of relaying containerized cargo. This

service provided crucial links between Indianports and assisted transhipment of cargo over

Indian ports.


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OUR UNDERSTANDING

It was a correct decision for shreyas to purchase

more in order to increase its fleet strength and

also to venture into logistics because by doing

so, the company improved the supply chain by

providing for tailor made logistics andtransportation solutions and thereby providing

the customers with door to door delivery and a

more safe, reliable, speed and well delivered

cargos.


10/15

CURRENTSCENARIOAND PRESENTSTRATEGIESADOPTED BY SHREYAS:

Shreyas has through the following M $ A, jointventures strategized and diversified itself.

1. Entry into the bulk coastal shipping.

Shreyas shipping and logistics has deployed MV

Unity, Indian flag coastal bulk vessel, as part ofstrategy to foray into the coastal bulk shippingoperations. M V Unity is single decker, self-geared,bulk ship strengthened for heavy cargo. By thismove it has positioned itself as an integrated multi-modal logistics service provider. Also emphasises toimprove coastal shipping in India.


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The company have diversified into domestic

logistics in order to de-risk its business from

volatile international freight and charter rates.

2.Shreyas have set up five warehouses and has

more than 4,000 containers which are used for

domestic multi-modal transportation.


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3. Shreyas Shipping & Logistics signs MoU with

Tata Motors:

Shreyas Shipping & Logistics, a provider of

multi-modal, integrated logistics & shipping

solutions, through its wholly owned subsidiary

Shreyas Relay Systems (SRS), has signed aMemorandum ofUnderstanding (MoU) with

Tata Motors, for acquisition of 50 trailers

and plans to invest INR170m at regularintervals.


13/15

The trailers to be acquired by Tata Motors are

new age vehicles with cutting-edge

technologies. The fleets of trailers have GPSconnectivity, providing real time information to

the clients about cargo, container and other

key aspects.The company has also received an agreement

for a warehouse and domestic cargo

distribution center at Tuticorin and plans to setup the same at Mundra and Cochin.


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This is in line with the long term vision of being

the most reliable, integrated logistics solutionsprovider in the country.


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Future Plans

Shreyas is always looking for new areas ofbusiness and is now looking at Greenfield

ventures in the areas of Mid-size parcel and

domestic logistics as it intends to offer better

Logistics solutions to its customers and thus tooffer International Liner Services, Mid-size

parcel and Domestic Logistics Services.

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