19 March ’07 Sical Presentation
SSKI Investor Meet, Singapore
Sical Growth Strategy
Scheme of Presentation
• Company overview
• Business segments
• Restructuring process
• Way forward
South India House, Armenian St, Chennai
Sical Growth Strategy
Legacy of Sical
• Founded by Late Dr.M.A.Chidambaram in 1955
• M.A.Chidambaram was the pioneering entrepreneur who introduced a slew of engineering products, including importantly, two wheelers and three wheelers into India
• Sical went public in 1981 and is listed in BSE and NSE
Dr.M.A.Chidambaram
Sical pioneered
Techno – innovations
in Chennai port
Sical Growth Strategy
Evolution of Sical
Focused growthDiversified Businesses
Offshore Logistics
12%
Container Logistics
16%
Inland Logistics
20%
Building Material
8%
Bulk Logistics
9%
Manfag5%
Marketing22%
Eng1% Mfg,
7%
Note: Includes revenues from PSA-SICAL & SICAL Distriparks
Offshore Logistics
16%Bulk
Logistics47%
Inland Logistics
21%
Container Logistics
16%
Non Logistics businesses
Sical Growth Strategy
Mission, Vision, Values
Mission
To deliver integrated multimodal logistics services by a highly motivated team using best practices and technology ensuring a dominating customer experience
Vision
To be the most preferred integrated multimodal logistics services provider in bulk and container logistics in India with global presence
Goal
To become a billion dollar company by 2012
Values
• People
• Service
• Profit
Sical Growth Strategy
Sical Logistics Limited – Overview
BULK LOGISTICS
Port handling
Coal Terminal
Iron Ore Terminal
CONTAINER LOGISTICS
Container Terminals
CFS & ICDs
INLAND LOGISTICS
Trucking
Warehousing
OFFSHORE LOGISTICS
Offshore Supply Vessels
Bergen Offshore
Sical Growth Strategy
Scheme of Presentation
• Company overview
• Business segments
• Restructuring process
• Way forward
Sical Growth Strategy
Port Handling involves loading and discharging cargo to/from vessels to docks during import and export trade
Sical continues to be the largest bulk cargo handling service provider in the sub-continent by volume
Present in all the major Indian ports – Chennai, Tuticorin, Vishakapatnam, Nhavasheva/Mumbai, Kandla, Haldia, Paradip, Goa, and also at several minor ports
Exclusive cargo-handling berths at Chennai Port for 20 years
Sical offers Customs House Agency & Shipping Agency services, apart from port handling, as a complete logistics solution to its customers
Port handling represents a total revenue of Rs. 2.2 Bn in FY06 with an EBITDA margin of 16.5%
Bulk LogisticsPort
HandlingCoal Terminal
EnnoreSical Iron
Ore Terminals Ltd
Segmental Revenues (INR million), 2006
Key Customers
Coal, 1411.6
Other Bulk, 281.4
Iron Ore, 69.7
Cement, 9.7
Fertiliser, 84.9
Steel, 288.2
Sical Growth Strategy
Port HandlingBulk Logistics
Coal TerminalEnnore
Sical Iron Ore Terminals Ltd
Sical has entered into a 20 year BOT contract with Tamil Nadu Electricity Board (TNEB) for handling coal at Ennore port
Project operations started in June 2002, and the concession period is up to 2022
Sical have to unload the coal at Ennore port and transport it to the adjoining power plant via a conveyor system
Sical has made a total investment of Rs.900 million and has installed 2 ship-unloaders and a mobile hopper. The total discharge capacity is 8,000 TPH
The Company makes an EBITDA margin of 24%, which is expected to stabilise at 20%
The current coal requirement is 8 million tons p.a., and all the coal reaches TNEB through Ennore port
TNEB has 3 thermal power generation plants that are serviced by Ennore coal terminal
Ennore (450 MW)
North Chennai (630 MW)
Mettur (840 MW)
Sical Growth Strategy
Coal TerminalEnnore
Sical Iron Ore Terminals Ltd
Port Handling
Sical Iron Ore Terminals Limited (SIOT), a SPV of Sical led consortium would implement the project of establishing a Common User Iron Ore Terminal on BOT basis and operate the same for a period of 30 years.
The proposed Ennore Iron ore terminal would be the largest in Asia with an initial capacity to handle 12mn MT, with a stack yard of 1.2 million tons.
Concession agreement has been entered with Ennore Port
Detailed Project Report has been submitted by SIOT to the port
Terminal would be operational from 2009
Project cost is Rs 4800 million
Export potential at Ennore terminal is expected to increase to 15mn MT annually by 2012
Bulk Logistics
Sical Growth Strategy
Port Handling Coal TerminalEnnore
Sical Iron Ore Terminals LtdBulk Logistics
Name of equipment Number
Ship Loader 1 5000 TPH
Stacker 2 4000 TPH
Reclaimer 2 5000 TPH
Wagon Tippler(fully covered with dust suppression and extraction system)
2 1800 TPH25 to 30 Tipples/ hr
Conveyor system
Tippler to Stockpile feeder conveyorStockpile cross conveyors
33
Fully enclosed with dust suppression systems4000 TPH5000 TPH
Railway yard To accommodate 3 loaded and 3 empty rakes
Capacity
Ship Loader
Wagon TipplerWind barrier plantation around the site, rain water harvesting
and a settling pond are also provided for.
Sical Growth Strategy
Sical Distriparks Limited is a 90% subsidiary of SICAL and associates.
It focuses on containerised logistics across India and operates and manages CFS at Chennai, Vizag, and Tuticorin
Sical Distriparks has a 55 acre CFS facility in Chennai, including reefer storage & bonded warehouses.
Services offered include container yards, bonded and general warehousing, and third party logistics (3PL)
Company has an exclusive contract with Maersk for en bloc movement for 3 years
It handled 59,169 TEUs during FY2005-06
The main commodity handled are waste paper, metal scrap & auto parts
Revenues for FY2005-06 was INR 20.76 Crore against INR 10.60 Crore in the previous year. The profit before tax was INR 3.69 Crore
Container Logistics
Key Customers
PSA SICAL Sical Gupta Logistics Ltd
Sical Distriparks
Container RailCompany Ltd
Container Freight Station, Chennai
Sical Growth Strategy
Containerised Cargo Handled
254
307321
2004 2005 2006
SICAL holds 37.5% stake in the JV (62.5% - PSA Corporation of Singapore) in PSA Sical.
Has bagged 30 year contract to equip, operate and manage Tuticorin Container Terminal
PSA International Pte Ltd, a global leader in the ports and terminals business, with investments in 20 port projects in 11 countries.
PSA SICAL manages container terminal at Tuticorin since 1999.
PSA SICAL has recently bagged the contract to operate second container terminal at Chennai.
Revenue in FY 2005 was Rs.66.14 crore against Rs.63.07 crore in the previous year.
PSA SICAL Sical Gupta Logistics Ltd
Sical Distriparks
Container RailCompany Ltd
(‘000 TEUs)
Container Logistics
Sical Growth Strategy
Multimodal International Hub Airport at Nagpur (MIHAN)
Sical-led consortium has won the bid to build railway and road terminals at the international airport hub at Nagpur on B-O-T basis. The lease period is 66 years
Facilities include a container freight station with rail siding and handling infrastructure for bulk and containerised cargo
The initial planned capacity is 50,000 TEUs
The terminal is expected to be operational in the first quarter of FY2008-09
Planned facility
PSA SICAL Sical Gupta Logistics Ltd
Sical Distriparks
Container RailCompany Ltd
Area (sq mtr) ICD Rail Yard Domestic Shipment
Warehouse 3,740 imports3,740 exports3,740 Bonded
Nil 15,120
Paved areas 50,000 21,000 7,332
Open Storage Areas
20,700 Nil 10,050
Location of MIHAN
Container Logistics
Sical Growth Strategy
Amritsar
Delhi
Indore
NagpurKolkata
Vizag
KakinadaGunturBangalore
Chennai
Mumbai
Mundra
Hazira
Pipavav
Trunk route
Secondary route
PSA SICAL Sical Gupta Logistics Ltd
Sical Distriparks
Container RailCompany LtdContainer Logistics
Container Rail ProjectSical had procured all-India license for operating container trains for 20 yearsSical would operate container trains and build rail linked ICDs to ensure integrated logistics solutionsSical has identified Attipattu near, Chennai and Devengunthi near Bangalore for developing Multi-modal hubs Rail linked container terminal with rolling stock would be established at MIHAN NagpurThe company plans a first phase 3-year investment of Rs 3,750 million, of which Rs 500 million has already been paid to government as license feeThe investment will go towards developing rail sidings at inland locations, container depots and investments in container rolling stock and handling equipmentThe proposed terminals would be operational by 2008
Sical Growth Strategy
Inland Logistics
Sical is one of the major operators in the South Indian trucking industry, transporting over 7,500 MT of cargo daily
Cargo transported includes dry bulk, liquid bulk, ODC, project equipment and hazardous chemicals
Currently, Sical owns a fleet of about 481 vehicles (58 specialised and 423 conventional tippers, trucks and tankers) and regularly contracts a fleet of about 2,000 vehicles on workhire basis
It has introduced GSM/GPS systems for high value cargo carrying trucks to track these vehicles on a real-time basis
Sical has a long term contract with Shell for transporting the petroleum products
Sical has ear-marked Rs.50 Crore for procuring 300 double-axle trucks and tankers as part of its expansion plans
Trucking Warehousing
Existing Operations
Key Customers
Steel24%
Others22%
Fertilizers41%
Cement13%
Sical Growth Strategy
The warehouse division serves as a captive warehouse of Spic catering to its fertilizer division and carrying out Trucking & Warehousing activities from packaging to the delivery at dealer point.
Sical has 103 warehouses at different locations of Tamilnadu, Andhra Pradesh, Karnataka, and Kerala.
Existing Facilities
Covered Warehouses – Hire – 306235 Sq.Ft
Covered Warehouses – Own – 215577 Sq.Ft
Open Plot - Own – 420000 Sq.Ft (approx)
Rented Warehouses
1 godown / compartment, 30317 Sq.Ft is rented out to Albert & Co, for storing imported fertilizer.
1 godown / compartment, 15292 Sq.Ft is rented out to Aaruran Sugars.
4 compartments (67908 Sq.Ft) are rented out to Villavarayar & sons for storing wheat.
Value added services include bagging and packing, palletizing, strapping, and shrink packing
Inland LogisticsTrucking Warehousing
Key Customers
53
25
1411
Tamilnadu AndhraPradesh
Karnataka Kerala
Planned facility
Sical Growth Strategy
Offshore Logistics
Bergen OffshoreLogistics Pte LtdOffshore Logistics
Key Customer
Sical’s offshore venture is to tap the highly lucrative markets of offshore supply vessels and related servicesAs a strategy, the company has successfully bid and won the offshore support services contract from ONGCThe present scope of operations include providing Operations and Maintenance (O&M) services to the fleet of 15 offshore vessels of ONGCSical has an office and workshop in Kakinada to service dry docking and maintenanceIt has a Quality Assurance system and a working HSE program currently in place within the organisation, which is ISN certified.Sical Logistics is compliant with ISPS and all other relevant international and contractual requirements.
Sical Growth Strategy
Offshore Logistics
Bergen OffshoreLogistics Pte LtdOffshore Logistics
Sical acquired Bergen Offshore Logistics Pte Ltd to provide high-end offshore logistics services to the global energy and heavy engineering sectors
Bergen Offshore one Platform Supply Vessel (PSV)
The acquisition of Siem Mollie, acquired from Siem Offshore SA, Norway, is the first acquisition of a new build offshore PSV by an Indian company.
Post acquisition, the PSV has been rechristened Sical Torino.
The PSV has been deployed in the North sea region on spot market
The business would target global offshore energy service providers
This is the first step towards global presence in offshore logistics
Bergen Offshore has chalked plans to acquire more offshore supply vessels and dredgers to expand its spectrum of services
Sical Torino
Sical Growth Strategy
Scheme of Presentation
• Company overview
• Business segments
• Restructuring process
• Way forward
Sical Growth Strategy
Restructuring Process
Financial restructuring Organisational restructuring
Functional Reorganisation
IDFC Private placement
Demerger of Non Logistics business
Integrated Complete Customer Solution
Sical Growth Strategy
Financial Restructuring
Rs. 1.1 Billion Equity Infusion by IDFC Private Equity
IDFC Private Equity has offered to invest Rs.1.1 billion in the logistics business
The proposed investment would be through a preferential issues of equity shares
De merger of Non Logistics Businesses
Proposes to de-merge the non-logistics businesses comprising of trading undertakings, services undertaking and coffee plantations
Dis-investment of the Other Non-Logistics Assets
Refractory – VRW to shut down and the land to fetch around Rs. 300 million
Palm Oil – De-merger resulting in Rs.250 million of inflow
Auto Components – Firm Offer for sale of Indrad Auto Components company in the range of Rs. 120 – 150 million
Manufacturing – Actively looking at exiting in chemicals, drums and pipes
Building Material – Large overseas players keenly looking to invest, based on KSA Technopak research. Disinvestment will be in stages, in view of the strategic interest in SICAL’s fleet of trucks and spread of warehouses
Sical Growth Strategy
Scheme of Presentation
• Company overview
• Business segments
• Restructuring process
• Way forward
Sical Growth Strategy
Thank You
Contact details :-
Karthik Menon
Sical Logistics Limited
Phone 0091 44 2235 1014
Mobile 0091 98407 07378
Email : [email protected]