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Logistics plays a crucial role in the business and economic growth of India. It refers to acquiring, storing, and transporting goods to their final destination. The best logistics companies in India contribute around 14% to Gross Domestic Product (GDP). The logistics industry generates many job opportunities including delivery executives, warehouse management staff, and others.
Overview of the Logistics Industry in India
Logistics companies help reduce transportation costs because they choose optimized routes and modes of transportation which results in reduced costs for end-users. It also allows Indian goods to be competitive in the global market which also results in increased exports. The logistics industry in India is a crucial component of the country's economy.
India's logistics market was valued at $215 billion in 2020. It is expected to grow at a CAGR of 10.5% to reach $320 billion by 2025 driven by e-commerce, manufacturing, and infrastructure development. The warehousing segment is growing at 20-25% annually. The industry contributes about 14-15% to India's GDP. It employs about 22 million people. Improving logistics can potentially boost GDP by 2-3% and generate 20-25 million additional jobs by 2040.
Only 20-25% of Indian freight moves through organized logistics channels. The remaining is unorganized due to a lack of adequate warehousing, cold chain, and transportation infrastructure. Only 5-10% of warehousing is managed. Roads account for 60% of India's freight transportation. Rail and coastal shipping have only a 20-25% share each. Multi-modal logistics is underdeveloped. Only 10% of cargo uses two or more modes of transport.
High logistics costs (14% of GDP vs 10% globally), fragmented market, lack of digitization, skills shortage, and policy/regulatory hurdles hinder the industry's growth. The logistics infrastructure deficit is estimated at $120 billion. Additionally, programs like Bharatmala, Sagarmala, and Dedicated Freight Corridors aim to bridge the infrastructure gap. GST and e-way bills have streamlined processes. Startups are driving innovation in areas like digital freight platforms, cold chain, and last-mile delivery.
Key Technical Factors in Logistics in India
The success and competitiveness of a logistics company in India are determined by its ability to utilize and implement advanced technologies. Here are key technical factors that contribute to making a logistics company stand out:
Technology Integration
The implementation of real-time tracking systems using GPS technology allows for precise monitoring of shipments. This enhances visibility and enables timely responses to any disruptions or delays in the supply chain.
Radio Frequency Identification (RFID) is used for asset tracking, inventory management, and supply chain visibility. RFID tags and readers facilitate accurate and automated data capture. These tags and readers reduce manual errors and streamline operations.
Automation in logistics contributes to increased efficiency and reduced operational costs.
Data Analytics
Data analytics is employed to analyze historical traffic patterns, weather conditions, and other relevant factors to optimize delivery routes. Reducing transit times minimizes fuel consumption and transportation costs.
Logistics companies can improve their demand forecasting accuracy by utilizing predictive analytics. This allows for better inventory planning.
Data analytics tools help identify inefficiencies in the logistics process. This includes analyzing the performance of different carriers, optimizing warehouse layouts, and identifying areas for process improvement.
Warehouse Management Systems (WMS)
WMS enables real-time tracking of inventory levels which reduces the risk of stock-outs or overstock situations. This leads to better demand planning, lower carrying costs, and improved overall inventory efficiency.
WMS facilitates order picking and packing processes. It provides accuracy and speed in fulfilling customer orders. Automation within warehouses such as the use of conveyor systems and robotics, enhances order fulfillment capabilities.
Seamless integration of WMS with other enterprise systems such as ERP (Enterprise Resource Planning) and transportation management systems gives a holistic and synchronized approach to logistics operations.
Let's go through the best 3PL logistics companies in India.
Top Logistics Companies in India
Here are some of the best logistics companies in India:
Blue Dart Express Ltd:
Blue Dart is known for its advanced technology in express logistics. They have invested in technology for real-time tracking, route optimization, and customer communication. Their use of RFID and GPS technologies improves shipment visibility. Blue Dart has received various awards including recognition for its excellence in technology and innovation in the logistics sector. It is also one of the best logistics companies in India for e-commerce.
As of November 2023, the current share price of Blue Dart Express Ltd is ₹ 6,675.95. In the last 1 year, the stock has generated a return of 4.15%. In 52 weeks, the stock was highest at ₹ 7,939 and lowest at ₹ 5,631.75. The market capitalization of Blue Dart Express Ltd is ₹ 15,904.12 crores.
Gati Ltd:
Gati focuses on technology-driven solutions including route planning and optimization, warehouse management systems, and end-to-end supply chain visibility. They have implemented track and trace technologies to provide real-time shipment updates. Gati has been recognized for its contributions to the logistics and supply chain industry.
The current share price of Gati Ltd is ₹ 80.65. In the last 1 year, the stock has generated a return of approximately -15%. In 52 weeks, the stock was highest at ₹ 95 and lowest at ₹ 73. The market capitalization of Gati Ltd is ₹ 421.41 crores.
Aegis Logistics Ltd:
Aegis Logistics Ltd is one of the best logistics companies in India. It provides services in various modes of transportation and is known for its multimodal transportation solutions. The company offers customs clearance, freight handling for air and sea, and 3PL logistics services. Aegis is widely recognized in the logistics industry because of its vulnerable contributions.
As of November 2023, the current share price of Aegis Logistics Ltd is ₹ 352.85. The market capitalization of Aegis Logistics Ltd is ₹ 5,837.65 crores.
Mahindra Logistics:
Mahindra Logistics provides technology services for end-to-end supply chain visibility, warehouse management, and transportation optimization. They use data analytics to plan their routes and manage their inventory effectively. Mahindra Logistics has received recognition for its commitment to technological advancements in the logistics and supply chain domain. It is also one of the best logistics companies in India for e-commerce.
The current share price of Mahindra Logistics Ltd is ₹ 593. The market capitalization of Mahindra Logistics Ltd is ₹ 4,837.53 crores. It operates in the Logistics/Supply Chain industry.
Sical Logistics:
Sical Logistics is an integrated logistics solutions provider based in India. It operates in various segments including port handling, transportation, and logistics infrastructure. Sical Logistics is recognized for its contributions to operational efficiency, safety measures, and performance in providing logistics solutions.
The current share price of Sical Logistics Ltd is ₹ 35. In the last 1 year, the stock has generated a return of approximately -15%. In 52 weeks, the stock was highest at ₹ 41.2 and lowest at ₹ 32.
Allcargo Logistics:
Allcargo Logistics emphasizes the use of technology for supply chain visibility, container tracking, and warehouse management. They have implemented automation in their logistics operations. Allcargo Logistics has received awards for excellence in logistics and cargo handling.
The current share price of Allcargo Logistics Ltd is ₹ 272. The market capitalization of Allcargo Logistics Ltd is ₹ 7,837.65 crores. It operates in the Logistics/Supply Chain industry.
VRL Logistics Limited:
VRL Logistics is also one of the best logistics companies in India. It uses advanced technologies to manage its fleet efficiently. This includes GPS tracking, route optimization, and real-time monitoring. VRL Logistics is famous for its outstanding performance in logistics and cargo handling.
The current share price of VRL Logistics Ltd is ₹ 730. In the last 1 year, the stock has generated a return of approximately 55%. In 52 weeks, the stock was highest at ₹ 780 and lowest at ₹ 471. The market capitalization of VRL Logistics Ltd is ₹ 10,837.65 crores.
Final Words
The logistics industry in India is a vital driver of economic growth. It significantly contributes to GDP and employment. The best logistics companies in India include Blue Dart Express, Gati, and Aegis Logistics. They showcase their ability through advanced tracking systems, RFID technology, and efficient warehouse management. Innovations in data analytics, artificial intelligence, and sustainable practices are shaping the future of India's logistics sector. This promises to improve competitiveness and create a positive economic impact.