Timescan Logistics (India) Ltd Management Discussions

SHIPPING INDUSTRY & PORTS IN INDIA

(Source: IBEF)

The Indian logistics industry is a large and growing sector, currently valued at USD 354 billion and contributing 18.4% to the country?s GDP. It?s expected to reach USD 428.7 billion by 2033, growing at a CAGR of 6.50% from 2025 to 2033. The industry encompasses various segments like transportation, warehousing, and freight forwarding, with roadways currently dominating the transportation sector.

India has 12 major and 200+ notified minor and intermediate ports. Under the National Perspective Plan for Sagarmala, six new mega ports will be developed in the country. The Indian ports and shipping industry play a vital role in sustaining growth in the country?s trade and commerce. India is the sixteenth-largest maritime country in the world with a coastline of 7,516.6 kms. The Indian Government plays an important role in supporting the ports sector. It has allowed Foreign Direct Investment (FDI) of up to 100% under the automatic route for port and harbour construction and maintenance projects. It has also facilitated a 10-year tax holiday to enterprises that develop, maintain, and operate ports, inland waterways, and inland ports. According to the Ministry of Shipping, around 95% of India?s trading by volume and 70% by value is done through maritime transport.

MARKET SIZE

In FY24, all key ports in India handled 817.97 million tonnes (MT) of cargo tra_ic, a 4.45% increase from 784.305 million tonnes in FY23. India?s merchandise exports in FY23 were at Rs. 39,21,896 crores (US$ 451 billion) from Rs. 36,26,232 crores (US$ 417 billion) in the previous year. The Government has taken several measures to improve operational efficiency through mechanisation, deepening the draft and speedy evacuations.

INVESTMENTS/DEVELOPMENTS

• Cargo tra_ic at 12 major Indian ports increased by 3.22% in December, reaching 72.15 million tonnes (MT). Deendayal Port Authority and Paradip Port Authority were the top performers handling 13.03 MT and 12.84 MT of cargo, respectively.

• In 2023-24, major Indian ports improved their container turnaround time to 22.57 hours, outperforming global standards, resulting in earnings of Rs. 1,570 crore (US$ 188 million) for Paradip Port, which saw a 21% increase in net surplus, while Jawaharlal Nehru Port reported a net surplus of Rs. 1,263.94 crore (US$ 151 million). The average turnaround time at major ports during FY25 (April-October) was 50.7 hours.

• Adani Ports and Special Economic Zone Ltd. has secured a five-year operation and maintenance contract at Kolkata Port, which will help the company enhance synergies with its transshipment hubs in Colombo and Vizhinjam.

• India plans to establish a new shipping company to expand its fleet by at least 1,000 ships in the next decade, aiming to reduce freight costs and capture more revenue from increasing trade, with joint ownership by state-run oil, gas, and fertilizer companies, along with the state-run Shipping Corporation of India and foreign companies, targeting a reduction of at least one-third in foreign freight outgoings by 2047.

• India?s 12 major ports handled 819.227 million tonnes of cargo in FY24, a 4.45% increase from 784.305 million tonnes in FY23, driven by strong growth in iron ore, raw fertilizer, coking coal, and container shipments, with Jawaharlal Nehru Port Authority handling over half of the total container volumes.

• Paradip Port in Odisha emerged as India?s largest major port in terms of cargo volumes, handling 145.38 million tonnes in FY24, surpassing Deendayal Port Authority in Gujarat for the first time in its 56-year history, driven by improved operational efficiency, record coastal shipping tra_ic, and increased thermal coal shipping.

• Adani Group plans Rs. 26,088 crore (US$ 3 billion) investment over three to five years to expand global ports capacity, targeting strategic acquisitions in Europe, Africa, and Southeast Asia to increase revenue from overseas ports to 20-25% and support the India-Middle East-Europe Economic Corridor.

• On February 2023, sanctioned projects under PPP include upgrading JNPA Hospital to a 100-bed multi-specialty hospital Rs. 59.13 crore (US$ 6.8 million), developing Berth No.13 at Deendayal Port for handling clean cargo Rs. 206.96 crore (US$ 23.8 million), and mechanizing NCB-III at V.O. Chidambarnar Port for dry bulk cargo Rs. 328.71 crore (US$ 37.8 million).

• Additionally, operations and maintenance of Berth Nos. 10 & 11 at Mormugao Port, Goa Rs. 1,73,050 crores (US$19.9 million), and the development of Mumbai Marina at Prince?s Dock of Mumbai Port Authority Rs. 714.81 crore (US$ 82.2 million) were approved under PPP arrangements in February 2023.

• On March 15, 2024, The Ministry of Ports, Shipping and Waterways approved Rs 645 crore (US$ 77.79 million) for 10 new waterways projects on the Brahmaputra in Assam, enhancing connectivity, boosting river tourism, and facilitating public commute, all under the Sagarmala programme.

• On March 09, 2024, India?s trade in container shipments experienced notable growth, totaling nearly 1.9 million TEUs, marking a 5% increase from January. Mundra Port managed 635,000 TEUs, Nhava Sheva Port handled 565,000 TEUs, and PSA Mumbai processed 158,000 TEUs.

• India has plans to invest US$ 82 billion in port projects by 2035.

• The Global Maritime India Summit 2023 to serve as a platform to showcase global best practices, foster investment partnerships and chart a new and bright course for our collective future.

• The cumulative FDI equity inflow in the Port industry is Rs. 14,237.96 crore (US$ 1,637.30 million) during the period April 2000 to September 2024.

• In October 2021, the Syama Prasad Mookerjee Port, Kolkata, gave importers the opportunity to bring in vessels at the deep drafted anchorages located at Sagar, Sandheads and X Point.

• India plans to cut its maritime carbon footprint by powering 1,000 vessels with renewable energy over five years. Aligning with net zero goals by 2070, the move supports eco-friendly cargo transport, backed by Rs. 50,000 crore (US$ 5.75 billion) infrastructure investment in inland waterways.

• Jawaharlal Nehru Port Trust (JNPT) Special Economic Zone (SEZ) became the first of its kind operational port-based multi-product SEZ in India.

• The Competition Commission of India (CCI) approved Adani Ports and Special Economic Zone?s proposed acquisition of 10.40% equity investment in Gangavaram Port in September 2021. The 10.4% equity shareholding will be bought from the government of Andhra Pradesh.

• APSEZ (Adani Ports and Special Economic Zone) plans to become the world?s largest private port company by 2030 and carbon neutral by 2025.

GOVERNMENT INITIATIVES

Some of the major initiatives taken by the government to promote the ports sector in India are as follows:

• India?s 12 major ports handled 72.2 million tonnes of cargo in December, growing 3.22%. In FY25 so far, total cargo reached 620 million tonnes, reflecting a 2.7% YoY increase.

• In October 2024, Union Cabinet approved the development of the National Maritime Heritage Complex (NMHC) at Lothal, Gujarat, showcasing India?s 4,500-year-old maritime heritage. This project is expected to enhance employment, tourism, and cultural preservation with phased development supported by public-private partnerships with a completion goal of 2025 for its first phase.

• In July 2024, the Union Minister for Ports, Shipping, and Waterways Mr. Sarbananda Sonowal approved a Rs. 284.19 crore (US$ 34 million) project by the Jawaharlal Nehru Port Authority (JNPA) to establish a comprehensive agricultural commodity processing and storage facility aiming to streamline logistics, reduce handling stages, and extend the shelf life of agricultural products. The projected export capacity includes a frozen store of 1,800 metric tonnes, a cold store of 5,800 metric tonnes, and dry warehouses for 12,000 metric tonnes of grains, cereals, and dry cargo.

• On 19 June 2024, the Government of India approved the establishment of a Major Port at Vadhavan, Maharashtra, with an estimated cost of Rs. 76,220 crore (US$ 9.14 billion), aiming to enhance EXIM trade capacity and accommodate mega vessels, while facilitating public-private partnerships for infrastructure development.

• On 29 July 2024, Secretary Mr. T.K. Ramachandran reviewed the functioning of the Paradip Port Authority (PPA) and inaugurated key projects worth over Rs. 13 crores (US$ 1.56 million), including a Trauma and Burn Care Centre and a Water Treatment Plant with a capacity to filter 16 million litres of water per day, enhancing the port?s infrastructure and services.

• On July 26, 2024, the Government of India announced an update to the Shipbuilding Financial Assistance Policy (SBFAP), which has provided financial aid totaling Rs. 337 crores (US$ 40.40 million) to enhance India?s competitiveness against foreign shipyards and revitalize the shipbuilding industry. Since the policy?s inception, 313 vessel orders valued at approximately Rs. 10,500 crores (US$ 1.26 billion) have been secured.

• On July 26, 2024, the Government of India announced 29 new proposals from Andhra Pradesh and Visakhapatnam Port Trust under the Sagarmala project, totaling approximately Rs. 3,300 crores (US$ 395 million). These initiatives include port development and fish landing centers.

• The Union Budget 2025-26 extends the Shipbuilding Financial Assistance Policy (SBFAP) 2.0 with Rs. 18,090 crores (US$ 2.08 billion) outlay, offering subsidies to Indian shipyards to offset costs and boost domestic shipbuilding.

• Under the Sagarmala Programme, 45 projects totaling Rs. 47,166 crores (US$ 5.69 billion) have been earmarked for execution at Non-Major Ports. Of these, 4 projects worth Rs. 5,419 crores (US$ 0.65 billion) have been finalized, while 17 projects valued at Rs. 27,673 crores (US$ 3.34 billion) are presently underway. Thirty-one out of the 45 projects are being carried out through Public-Private Partnership (PPP) mode, with a collective investment of Rs. 45,973 crores_(US$ 5.54 billion).

• On March 07, 2024, the Union Minister for Ports, Shipping, and Waterways, Mr.Sarbananda Sonowal approved a project exceeding Rs. 800 crores (US$ 96.48 million) to revamp Syama Prasad Mookerjee Port, Kolkata, encompassing berth reconstruction and mechanization to enhance operational efficiency and global competitiveness.

• On February 20, 2024, The Union Minister of Ports, Shipping & Waterways and Ayush, Mr. Sarbananda Sonowal initiated major waterways projects in North East India, including inaugurating terminals at Bogibeel and Sonamura, unveiling projects worth Rs. 308 crores (US$ 37.14 million), and announcing initiatives for improved connectivity and economic growth.

• The Ministry of Ports, Shipping and Waterways will invest over Rs. 57,000 crores (US$ 6.55 billion) to boost Kandla Port?s capacity, including a Rs. 30,000 crore (US$ 3.45 billion) mega shipbuilding project and Rs. 27,000 crore (US$ 3.10 billion) cargo terminal.

• On September 19, 2023, the Ministry of Ports, Shipping, and Waterways proposed the Indian Ports Bill with the aim of enhancing transparency in port tariffs and updating penalties. The bill empowers the Maritime States Development Council (MSDC) for integrated planning and introduces a three-tier dispute resolution mechanism for conflicts between state maritime boards.

• On August 24, 2023, the Ministry of Ports, Shipping and Waterways initiated the development of a Next-Gen Container Terminal at Tuna Tekra, Gujarat, through a Rs. 4,243.64 crore (US$ 511.7 million) PPP agreement with DP World, enhancing port infrastructure and trade connectivity.

• On January 27, 2023, the Honorable Minister for Ports, Shipping, and Waterways inaugurated the National Logistics Portal (Marine). This platform connects logistics stakeholders, enhancing efficiency, transparency, and reducing costs and time delays through IT integration. Covering all transport modes, it offers seamless end-to-end logistics service coverage.

• The government aims to increase Inland Water Transport (IWT) share to 5% by 2030 as per Maritime India Vision (MIV)-2030, emphasizing its cost-e_ectiveness and sustainability for bulk cargo transportation, particularly along National Waterway No. 1 (River Ganga).

• Under the Sagarmala initiative, the Ministry has initiated Ro-Pax Ferry operations connecting Ghogha to Hazira in Gujarat and Mumbai to Mandwa in Maharashtra. These services have facilitated the transportation of over 24.15 lakh passengers, 4.58 lakh cars, and 36.3 thousand trucks, promoting environmental sustainability and public welfare.

• In Union Budget 2023-24, the total allocation for the Ministry of Shipping was US$ 1,813.16 million (Rs. 2,218.74 crore).

• In October 2022, Cabinet Committee on Economic Affairs approved the development of a container terminal at Tuna-Tekra, Deendayal Port, the terminal will be built on a Build, Operate & Transfer (BOT) basis under Public-Private-Partnership (PPP) mode.

• In August 2022, Minister of Road Transport and Highways Mr. Nitin Gadkari, Minister of Ports, Shipping & Waterways and Ayush, Mr. Sarbananda Sonowal, and Minister of State for Road Transport & Highways, Gen (Retd) VK Singh signed a tripartite agreement for swift development of modern Multi Modal Logistics Parks (MMLP) under Bharatmala Pariyojna across the country.

• In July 2022, the Sagarmala programme is the flagship programme of the Ministry of Ports, Shipping and Waterways to promote port-led development in the country through harnessing India?s 7,500 km long coastline, 14,500 km of potentially navigable waterways and strategic location on key international maritime trade routes.

• In December 2021, India and Russia are talking about collaborating on shipbuilding and inland waterways.

ROAD AHEAD

Increasing investment and cargo tra_ic point towards a healthy outlook for the Indian ports sector. Providers of services such as operation and maintenance (O&M), pilotage and harbouring and marine assets such as barges and dredgers are benefiting from these investments.

The capacity addition at ports is expected to grow at a CAGR of 5-6% till 2022, thereby adding 275-325 MT of capacity.

Domestic waterways have found to be a cost-e_ective and environmentally sustainable mode of freight transportation. The government aims to operationalise 23 waterways by 2030.

To bolster the shipbuilding industry under the "Make in India" initiative, the Ministry introduced the Shipbuilding Financial Assistance Policy (SBFAP). This scheme, operational until March 2026, offers financial aid to Indian shipyards, encouraging competitiveness and securing global orders. With 88 vessel orders worth Rs. 6800 crores (US$ 820 million) procured by 31 shipyards over the past four years, the SBFAP has been instrumental.

Amendments to the SBFAP guidelines now provide increased financial assistance for vessels powered by green fuels and hybrid propulsion systems, further fostering indigenous manufacturing and technological advancement.

As part of the Sagarmala project, more than 574 projects worth Rs. 6,00,000 crores (US$ 82 billion) have been planned for implementation between 2015 and 2035.

The Ministry of Ports, Shipping and Waterways will invest over Rs. 57,000 crores (US$ 6.55 billion) to boost Kandla Port?s capacity, including a Rs. 30,000 crore (US$ 3.45 billion) mega shipbuilding project and a Rs. 27,000 crore (US$ 3.10 billion) cargo terminal.

In the Union Budget 2025-26, Union Minister of Finance and Corporate Affairs, Ms. Nirmala Sitharaman, introduced a Maritime Development Fund (MDF) of Rs. 25,000 crores (US$ 2.87 billion) to promote infrastructure and competitiveness within the maritime industry.

OVERVIEW

Timescan Logistics (India) Limited, an ISO 9001:2015 certified enterprise, stands at the forefront of the logistics industry, offering a comprehensive portfolio of end-to-end supply chain solutions across land, air, and sea. As a Multimodal Transport Operator and Third-Party Logistics (3PL) partner, we specialize in delivering seamless, integrated services, including Sea and Air Freight Forwarding, Customs Clearance, Warehousing, Multimodal Transportation, Project Cargo Management, 3PL Solutions, and specialized packaging, along with efficientloading, unloading, and unpacking services. Our agile, asset-light business model empowers us with unmatched scalability and operational flexibility, enabling us to craft bespoke logistics solutions tailored to diverse industry requirements. Backed by deep expertise and a commitment to operational excellence, we are steadfast in our vision to emerge as India?s most formidable and future-ready integrated transport utility, driving efficiency and connectivity across the nation and beyond.

INDUSTRY STRUCTURE AND DEVELOPMENTS

The logistics industry in India continues to undergo rapid transformation, emerging as a key enabler of economic growth and competitiveness. With the increasing emphasis on digitalization, infrastructure development, and policy reforms such as the PM Gati Shakti initiative and National Logistics Policy, the sector is witnessing enhanced efficiency, transparency, and integration.

Serving both inbound and outbound segments of manufacturing and service supply chains, logistics has become integral to the seamless flow of goods across domestic and global markets. The sector is also experiencing a strong push from rising e-commerce demand, the shift towards multimodal transportation, and a growing preference for third-party logistics (3PL) solutions.

Amid this dynamic landscape, the logistics industry is not only attracting focused attention from policymakers but is also becoming a strategic priority for businesses seeking agility, cost-e_ectiveness, and sustainability in their operations.

Current Industry Landscape

The Indian logistics industry is witnessing robust growth, driven by the expansion of e-commerce, globalization of trade, and strong government focus on infrastructure development and regulatory reforms. The sector plays a vital role in enhancing the country?s economic efficiency and enabling seamless movement of goods across regions.

Evolving beyond its traditional scope of transportation and warehousing, the industry is increasingly embracing technology to streamline operations and improve service quality. Businesses are adopting tools such as predictive analytics, automation, and real-time tracking to enhance operational control and responsiveness. Despite rapid development, the industry remains highly fragmented, comprising a wide range of participants—including domestic logistics providers, global players, government-operated postal services, and emerging startups. This diverse landscape covers core services such as freight transportation, warehousing, packaging, labelling, and inventory management.

The growing use of digital solutions like Transportation Management Systems (TMS), Warehouse Management Systems (WMS), and IoT-based monitoring is significantly improving operational efficiency, reducing costs, and increasing transparency. These advancements are reshaping the logistics ecosystem into a more agile, scalable, and competitive sector.

Key Industry Developments

Key developments in the logistics sector include a strong focus on technology integration, particularly with the rise of e-commerce and the need for efficientlast-mile delivery solutions. Government initiatives like the National Logistics Policy and PM Gati Shakti are also driving growth by improving infrastructure and promoting multimodal connectivity. Furthermore, there?s a growing emphasis on sustainable logistics practices, including green logistics and the adoption of autonomous vehicles.

1. Infrastructure Development: Infrastructure development is fundamental to enhancing the efficiency and capacity of the logistics sector. The expansion and modernization of roads, railways, ports, airports, and warehousing facilities are enabling smoother and faster movement of goods across domestic and international markets. Improved infrastructure reduces bottlenecks, shortens transit times, and lowers overall logistics costs. In India, focused efforts towards upgrading ports, developing dedicated freight corridors, and enhancing warehousing and cold storage facilities are contributing to the creation of a more robust and reliable logistics network to support the country?s growing trade and economic activities.

2. Technological Advancements:

Technological advancements are playing a vital role in improving the overall efficiency and capability of the logistics sector. Innovations in vessel design, cargo handling equipment, and storage solutions are contributing to smoother, safer, and more reliable movement of goods. Similarly, improvements in material handling systems, refrigeration technology, and container design are helping to reduce transit times, minimize losses, and ensure the safe transport of sensitive or perishable cargo. These advancements are supporting the logistics sector in meeting the growing demands of global trade while enhancing service quality.

3. Increased International Trade:

India?s growing international trade is a major driver for logistics growth. Increased international trade significantly impacts the logistics sector by creating a greater need for efficientcross-border movement of goods. This includes the transportation, storage, and delivery of products across countries, requiring robust supply chain management and international logistics strategies. Higher trade volumes mean more goods need to be moved internationally, driving up demand for transportation, warehousing, and other logistics services.

4. Embracing Sustainable Logistics Practices:

There is a growing emphasis on sustainable logistics practices and reducing the environmental impact of the industry. This involves adopting eco-friendly practices across the supply chain, from transportation and warehousing to packaging and waste management, to reduce carbon emissions, energy consumption, and waste generation. Green Logistics is a concept that emphasizes environmentally responsible practices in the movement of goods and services. It aims to reduce the negative environmental effects associated with logistics, such as pollution, resource depletion, and greenhouse gas emissions.

5. Increased Demand for Reliable Capacity:

Shortages of containers and vessel space continue to disrupt global shipping schedules, leading to delays, increased freight rates, and uncertainty in supply chains. Shipping lines are struggling to manage demand as container imbalances and port congestion persist in key trade routes. Similarly, in the air freight sector, there is a rising dependence on dedicated cargo flights to maintain supply chain efficiency, as the available belly capacity in passenger aircraft remains significantly limited in many regions. With passenger air travel yet to fully recover to pre-pandemic levels in several markets, this shortfall in belly capacity continues to constrain overall air freight capacity, putting upward pressure on air freight rates and further intense.

6. Expansion of Port and Airport Infrastructure:

Countries are investing heavily in expanding port capacities and airport cargo terminals to accommodate increasing trade volumes. In India, significant development is underway at major ports such as Jawaharlal Nehru Port, Mundra Port, and the Vizhinjam International Seaport to enhance maritime trade efficiency. Simultaneously, air cargo infrastructure is being strengthened at key airports including Delhi, Mumbai, Bengaluru, and Hyderabad to support the growing demand for exports and imports.

7. Shift in Cargo Preferences:

There is a noticeable shift in cargo preferences as businesses adapt to evolving market dynamics and logistical challenges. With ongoing disruptions in sea freight and limited vessel space, many companies are increasingly opting for air freight despite higher costs, to ensure faster delivery and maintain supply chain reliability. Additionally, there is growing demand for multimodal transport solutions that combine sea, air, and land freight, offering greater flexibility and efficiency in cargo movement.

8. Focus on Supply Chain Resilience:

There is an increased focus on supply chain resilience as companies seek to minimise disruptions and maintain operational continuity amid global uncertainties. Businesses are diversifying sourcing strategies, building bu_er inventories, and exploring alternative shipping routes to reduce dependency on single points of failure. Investment in infrastructure, technology, and strategic partnerships is also on the rise, aimed at enhancing the flexibility and reliability of supply chains in the face of ongoing challenges.

9. Strengthening Logistics Infrastructure:

The development of infrastructure, including roads, railways, ports, airports, and warehousing, plays a critical role in driving the growth and efficiency of the logistics sector. With a strong focus from the government on infrastructure enhancement, significant improvements are being made to facilitate smoother and faster movement of goods. These developments are helping reduce transit times, lower logistics costs, and improve the overall reliability and efficiency of supply chains, supporting both domestic and international trade.

10. Increasing Demand for Integrated Solutions:

The demand for integrated, end-to-end logistics solutions continues to grow as businesses seek greater efficiency, reliability, and cost-e_ectiveness in their supply chains. Companies are increasingly opting for service providers that can offer a comprehensive suite of solutions, covering transportation, warehousing, customs clearance, and last-mile delivery under a single platform. This trend is driving the consolidation of logistics operations and encouraging greater collaboration among service providers. In the current scenario, the emphasis is not only on operational integration but also on improving coordination across different modes of transport and enhancing service quality to meet the evolving needs of global trade.

SWOT ANALYSIS

The logistics sector remains a vital pillar of the global and Indian economy, playing a central role in enabling trade, commerce, and the uninterrupted movement of goods and information across industries. It serves as a critical link between producers and consumers, ensuring timely, reliable, and efficientdelivery through well-integrated transportation, warehousing, and supply chain systems. As economies grow increasingly interconnected, the logistics sector continues to underpin globalization and drive economic resilience. In the financial year 2024–25, the sector continued to navigate a complex environment shaped by persistent global uncertainties, including geopolitical tensions, inflationary pressures, and volatile fuel prices. Despite these headwinds, the logistics industry demonstrated strong adaptability by accelerating the adoption of digital technologies and automation to streamline operations and enhance visibility across the value chain. The deployment of AI, IoT-enabled tracking, and advanced data analytics has helped mitigate supply chain disruptions and improve overall efficiency.

India?s logistics landscape, in particular, has been buoyed by robust policy support through the National Logistics Policy (NLP), infrastructure upgrades, and multimodal logistics parks under the Gati Shakti initiative. These efforts aim to reduce logistics costs, improve transit times, and enhance supply chain competitiveness. Overall, the logistics sector remains on a transformational path—evolving from a support function to a strategic enabler of business growth, innovation, and sustainable development.

SEGMENT–WISE OR PRODUCT-WISE PERFORMANCE

The Company is mainly engaged into logistics and related allied services. Therefore, there are no separate reportable segments.

OUTLOOK

The outlook for the logistics sector remains robust and optimistic, supported by structural demand drivers, policy support, and the rapid digitalization of the supply chain ecosystem. As the Indian and global economies continue to recover and adapt to post-pandemic realities, the logistics industry is poised to play a pivotal role in facilitating seamless trade, efficientinventory movement, and real-time connectivity across markets.

The sustained growth of e-commerce and digital-first business models continues to reshape the logistics landscape, accelerating demand for faster, tech-enabled, and cost-e_ective delivery solutions. The shift towards omni-channel retail and increasing expectations for same-day or next-day delivery are pushing logistics providers to strengthen their warehousing, fulfillment, and distribution capabilities, especially in Tier 2 and Tier 3 cities.

Technological advancement remains a cornerstone of transformation in the sector. Logistics players are increasingly deploying artificial intelligence (AI), machine learning, Internet of Things (IoT), blockchain, and robotic process automation (RPA) to streamline operations, improve visibility, and enhance customer experiences. The integration of real-time tracking, automated route optimization, and data-driven analytics is helping companies manage complexity, reduce turnaround times, and respond swiftly to disruptions.

Sustainability has also become a defining priority. Driven by rising ESG expectations and government regulations, logistics firms are investing in green mobility, electric vehicle (EV) fleets, solar-powered warehouses, fuel-efficientroute planning, and sustainable packaging. These initiatives not only align with global climate goals but also serve as long-term differentiators in an increasingly conscious consumer and investor landscape.

Nonetheless, several headwinds remain. The sector must navigate continued volatility in fuel prices, high infrastructure costs, and persistent labour shortages in key operational roles. Regulatory uncertainties, geopolitical tensions, and global supply chain realignments may impact cross-border movements and increase compliance burdens. The evolving competitive landscape—especially the rise of asset-light, tech-native entrants—poses additional pressure on traditional business models.

Despite these challenges, the logistics sector is well-positioned to capitalize on India?s economic growth, enhanced infrastructure through initiatives like Gati Shakti and the National Logistics Policy, and growing investor interest in integrated logistics solutions. Companies that embrace digital transformation, expand their multimodal capabilities, and prioritize resilience and sustainability will be better equipped to thrive in this dynamic environment.

As the sector continues to evolve, collaboration, innovation, and strategic agility will be the key pillars driving the next phase of growth and enabling logistics providers to reinforce their indispensable role in global commerce.

With the pivotal role in driving economic progress by facilitating the efficientmovement of goods and services across the supply chain, the logistics sector contributes around 13-14% to GDP and provides livelihood for more than 22 million people. It enables timely delivery, decreases costs, and enhances competitiveness, crucial for thriving businesses.

Logistics boosts productivity and trade by improving connectivity infrastructure and adopting innovative technologies, thereby stimulating economic growth. Moreover, it fosters investment and supports various sectors, contributing significantly to GDP expansion.

RISKS AND CONCERNS

The Company?s sustained success depends on its ability to proactively identify, assess, and manage a diverse set of risks in a rapidly evolving and dynamic environment. Operating in the Indian logistics sector often regarded as the backbone of the supply chain. The Company is exposed to various risks, some foreseeable and manageable, others unforeseen and beyond control. An effective risk management framework is therefore essential to ensure business continuity, operational efficiency, and value creation for all stakeholders.

Through a formal risk assessment process, the management has identified key risks that may significantly impact the Company?s operations and performance. These include transportation disruptions, cybersecurity and data risks, environmental and climate-related risks, operational challenges, financial and security risks, and workforce constraints. The Company recognizes that risks are inherent to the nature of business and remains committed to a structured and forward-looking approach to their identification and mitigation.

In the current market environment, it is characterized by increasing digitization, growing e-commerce demand, elevated customer expectations, regulatory developments, and global uncertainties. The need for resilient and agile risk management practices is more critical than ever. The Company continues to embed risk awareness across its decision-making processes to safeguard operations and create sustained long-term value for its stakeholders. Recognizing that inherent risks are part of every business, the Company is committed to a proactive approach in continuously identifying and mitigating these risks. Our industry, in particular, faces a range of risks that could affect our operations in multiple ways:

1. Operational Risks:

• Port Congestion and Shipping Disruption: Container misplacement, port closures, and bottlenecks can significantly impact global shipping, causing delays and increased costs.

• Labor Shortages: Lack of available workers, strikes, and workforce instability can hinder operations across the supply chain.

• Supply Chain Disruptions: Events such as natural disasters, pandemics, political unrest, or strikes can disrupt the supply chain, causing delays and increased costs.

• Infrastructure Limitations: Dependence on aging or inadequate infrastructure (e.g., roads, ports, and rail networks) can lead to ine_iciencies and delays in the delivery of goods.

2. Financial Risks:

• Fluctuating Fuel Prices: Rising fuel costs can significantly increase transportation expenses.

• Insurance Costs: Premiums for insurance coverage can increase due to the inherent risks associated with logistics.

• Economic Downturns: Recessions or economic slowdowns can reduce demand for shipping and logistics services.

• Foreign Exchange Risk: For companies engaged in international logistics, currency fluctuations can affect profitability, especially if revenues and costs are denominated in different currencies.

• Credit Risk: Delays in payments from customers can affect cash flow and working capital, leading to financial instability.

3. Environmental and Climate-Related Risks:

• Climate Change Impact: The industry?s reliance on fossil fuels contributes to climate change, which can lead to more severe weather events and disruptions.

• Waste Generation: Logistics generates waste from packaging, pallets, and other materials, contributing to pollution and resource depletion.

• Environmental Regulations: Stricter environmental regulations regarding emissions, waste management, and energy consumption can increase compliance costs.

4. Regulatory and Compliance Risks:

• Compliance with Regulations: Logistics companies must comply with various national and international regulations, which can be complex and challenging to navigate.

• Jurisdiction and Governing Law: In cross-border logistics, determining which laws apply in case of a dispute can be challenging.

• Insurance Gaps: Ensuring adequate insurance coverage is crucial to mitigate potential financial losses from various risks.

• Health and Safety Regulations: Non-compliance with safety standards for transportation and warehousing can lead to legal liabilities, fines, and damage to reputation.

5. Safety and Security Risks:

• Hazardous Materials: Handling and transportation of hazardous materials pose significant safety risks.

• Theft and Loss of Goods: Theft of cargo, both internal and external, is a major concern. Measures like access control, video surveillance, security locks, and cargo tracking can help prevent theft.

• Compliance Issues: Non-compliance with regulations can lead to penalties, legal action, and reputational damage. Staying up-to-date with relevant regulations and implementing robust compliance procedures is essential.

6. Technological Risks:

• Inadequate Use of Technology: Lack of investment in technology or failure to adopt new technologies can hinder efficiency and competitiveness.

• Navigation Risks: Increased automation and digitalization can propagate unrecognized risks due to software and design flaws.

• Human Error: Digitalization can exacerbate human errors, especially with personnel unfamiliar with new technologies or cyber standards.

• Automation Challenges: Resistance to automation and technological changes from the workforce or lack of skilled personnel to manage new technologies can pose operational challenges.

7. Human Resource Risks:

• Talent Shortages: The sector struggles to find and retain skilled workers, especially in specialized roles like supply chain managers and certified drivers. This can lead to understaffing, delays, and operational ine_iciencies.

• High Employee Turnover: Demanding work conditions, long hours, and limited career progression contribute to high turnover rates, resulting in increased recruitment and training costs, as well as workflow disruptions.

• Rising Labor Costs: Increased turnover, wage increases, and the cost of benefits contribute to rising labor costs.

• Labour Unrest: Industrial actions, strikes, and unrest among employees or contract workers can halt operations and affect service levels.

8. Geopolitical Risks:

• Currency Fluctuations: Geopolitical events can cause volatility in currency exchange rates, impacting import and export costs and overall pricing.

• Tari_s and Trade Barriers: Increased tariffs and trade barriers can significantly raise the cost of goods, impacting both businesses and consumers.

• Political Instability and Conflict: Unrest, armed conflicts, and terrorism can disrupt transportation routes, manufacturing operations, and overall business environments, causing significant delays and safety concerns.

9. Economic and Market Risks:

• High Initial Costs: Implementing sustainable practices, such as investing in electric vehicles or alternative fuels, can require significant upfront investments.

• Cost of Compliance: Stricter environmental regulations and carbon taxes can increase operating costs for logistics companies._

• Supply Chain Disruptions: Climate change and extreme weather events can disrupt supply chains, leading to increased costs and delays.

• Competitive Pressure: Increased competition from established players and new entrants can lead to price wars, reduced margins, and loss of market share.

10. Reputational Risks:

• Poor Customer Service: Inadequate communication, mishandled orders, or rude interactions with customers can erode trust and damage a company?s reputation.

• Product Recalls: Defective products, or products damaged during transit, can necessitate recalls, leading to significant financial losses and reputational damage.

• Unexpected Price Hikes: Unplanned increases in shipping costs or surcharges can negatively impact customer perception and lead to accusations of unfair business practices.

• Failure to Execute Strategy: Inability to implement strategic initiatives, such as expansion into new markets or diversification of services, can limit growth opportunities and affect long-term sustainability.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has robust internal control system designed to ensure efficientoperations, compliance with regulations, and mitigation of risks. These systems involve various checks and balances, such as authorization, documentation, reconciliation, and segregation of duties, to prevent errors, fraud, and non-compliance. Effective internal controls are essential for managing inventory, tracking shipments, handling finances, and ensuring the safety and security of goods.

The Company has designed specific controls to address the identified risks related to its objectives. The system begins with clearly defined objectives for the organization, such as financial reporting accuracy, operational efficiency, and compliance with laws and regulations. These controls can be preventative (designed to stop errors or irregularities from occurring) or detective (designed to identify errors or irregularities after they have occurred).

The Company regularly monitors the effectiveness of their internal controls. This involves ongoing monitoring activities, such as regular reviews, tests, and audits. The purpose is to identify any weaknesses or deficiencies in the system and take corrective action. The internal control system is not static; it needs to be continuously improved and updated. As the business environment changes, and as new risks emerge, the company needs to adapt its controls to remain effective. This involves regularly reviewing and updating policies, procedures, and controls to ensure they are still relevant and effective.

The Audit Committee, composed of Independent and Non-Executive Directors regularly reviews significant audit findings, adequacy of internal controls, audit plans, reasons for changes in accounting policies and practices, if any, and monitors the implementation of audit recommendations. Audit Committee has oversight responsibilities in relation to financial reporting, internal control structure, risk management systems, internal

SIGNIFICANT CHANGES IN KEY FINANCIAL RATIOS

Particulars	Ratio as on 31st March, 2025	Ratio as on 31st March, 2024	Change in percentage of ratio as compared to previous year
Debtors Turnover Ratio	12.46	11.89	4.79% (Increase)
Current Ratio	2.13	1.88	13.30% (Increase)
Operating Profit Margin	9.51	8.40	13.23% (Increase)
Net Profit Margin	2.27	1.88	21.03% (Increase)

Notes:

1. Debtors turnover is a measure of a company?s effectiveness in collecting receivables from its customers. The receivables turnover ratio improved during the Financial Year 24-25 due to further improvement in billing and collection processes.

2. There are no significant changes (i.e. change of 25% or more as compared to the immediately previous financial year) in the other key financial ratios.

3. The Company is service-based industry. So, Inventory Turnover Ratio is not applicable to the Company.

DEVELOPMENTS IN HUMAN RESOURCES

At Timescan, we placed a strong emphasis on enhancing the skills, knowledge, and capabilities of our employees to drive both individual growth and organizational excellence. Through targeted technical, managerial, and behavioral training programs, we equipped our workforce with the tools required to excel in their current roles and prepared them for future responsibilities. We successfully supported employees in planning their career paths by offering clear advancement opportunities within the organization. Our structured guidance and developmental support helped individuals sharpen their competencies and achieve their professional aspirations, reinforcing our commitment to fostering long-term career growth and employee satisfaction.

In today?s dynamic and competitive business environment, Human Resource Development (HRD) has evolved beyond traditional training methods into a strategic, integrated, and interdisciplinary function. It plays a vital role in building a resilient, future-ready workforce capable of adapting to rapid technological advancements, shifting customer expectations, and emerging industry trends. At Timescan, HRD is viewed as a continuous and structured process designed to empower our employees to:

a. Acquire and upgrade skills aligned with current job requirements and future organizational needs, keeping pace with evolving industry standards and innovations.

b. Develop their full potential by enhancing personal capabilities, thereby contributing meaningfully to both individual career progression and the company?s sustained growth.

c. Strengthen a high-performance culture rooted in collaboration, mutual respect, and effective leadership—fostering a workplace environment that enhances employee engagement, motivation, well-being, and a shared sense of purpose.

At Timescan, we believe that people are the true drivers of sustainable growth. Human Resource Development (HRD) at our organization is fundamentally about transforming latent potential into active capability—turning human resources into a powerful engine of performance and innovation.

In the current dynamic and technology-driven market environment, the importance of human capital has surpassed that of physical assets. Growth, adaptability, and resilience are possible only when employees evolve alongside the organization. Recognizing this, we have adopted a holistic and future-focused approach to HRD that not only supports the professional development of our employees but also nurtures their individual creativity, talent, and aspirations.

Our HRD initiatives go beyond functional skill-building. We aim to unlock the inner potential, emotional intelligence, and leadership qualities of our workforce through systematic, structured programs that align with both business goals and individual ambitions. The scope of HRD at Timescan encompasses technical training, behavioral development, leadership grooming, and values-based education, ensuring a workforce that is agile, competent, and ethically grounded.

We have fostered a workplace culture where continuous learning, collaboration, and psychological safety are integral to daily operations. Ethical conduct and regulatory compliance form the cornerstone of our people practices. All employees undergo regular training to stay aligned with our Code of Conduct and evolving governance standards.

In line with our employee-centric approach, we implemented flexible work arrangements, including Work From Home policies wherever feasible, to ensure employee safety, well-being, and productivity—especially in response to emerging challenges.

As on date, the Timescan family comprises 86 dedicated employees, including 5 Key Managerial Personnel. Each individual plays a pivotal role in propelling the organization forward, and we remain committed to investing in their growth as we continue our journey of excellence.

CAUTIONARY STATEMENT

This document contains statements about expected future events, financial and operating results of Timescan Logistics (India) Limited, which are forward looking. By their nature, forward looking statements require the Company to make assumptions and are subject to inherent risks and uncertainties. There is a significant risk that the assumptions, predictions and other forward-looking statements will not prove to be accurate. Several factors that could significantly impact the Company?s operations include economic conditions affecting demand, supply and price conditions in the domestic and overseas markets, changes in the government regulations, tax laws and other statutes, climatic conditions and such incidental factors over which the Company does not have any control. Readers are cautioned not to place undue reliance on forward looking statements as a number of factors could cause assumptions, actual future results and events to differ materially from those expressed in the forward-looking statements. Accordingly, this document is subject to the disclaimer and qualified in its entirety by the assumptions, qualifications and risk factors referred to in the Management?s Discussion and Analysis of Timescan Logistics (India) Limited?s Annual Report, for FY 2024-25.