Total Transport Systems Ltd Management Discussions

“Annexure - V”

Evolving Global Logistics Scenario

The global logistics industry is undergoing a significant transformation, propelled by digital disruption, geopolitical uncertainties, evolving trade dynamics, and sustainability imperatives. According to Research and Markets, the global logistics market is projected to grow from USD 9.6 trillion in 2023 to USD 13.7 trillion by 2028, at a CAGR of 7.4%. This surge is being driven by increasing global trade volumes, growing e-commerce penetration, and a rising emphasis on supply chain resilience and digital transparency.

Key trends shaping the industry include:

• Digitalization & AI Integration: Companies are automating core functions like route optimization, warehouse operations, and inventory forecasting to enhance speed and reduce human error.

• Supply Chain Resilience: Global firms are re-evaluating supply chain strategies in response to pandemic-era disruptions, container shortages, and geopolitical conflicts. Nearshoring and regional sourcing are becoming more prevalent.

• Sustainability Focus: The freight sector, contributing over 3% to global emissions, is investing in electric mobility, green fuels like hydrogen and ammonia, and carbon-neutral logistics operations to meet net-zero targets by 2050.

• Cross-border E-commerce: Cross-border logistics has seen a major uptick, particularly in Asia-Pacific and North America, demanding real-time visibility and agile delivery models.

Global giants like Maersk, FedEx, and Amazon continue to invest heavily in digital ecosystems, end-to-end visibility tools, and green fleets, creating a benchmark for mid-tier logistics companies to follow.

Policy Reforms & Government Initiatives

The Indian Government has undertaken multiple initiatives to modernize and streamline the logistics ecosystem:

• National Logistics Policy (NLP 2022): Aims to reduce logistics costs from the current 13-14% of GDP to 8% by improving infrastructure, digital integration, and standardization across logistics modes.

• PM Gati Shakti Master Plan: A n100 lakh crore mega infrastructure plan integrating 16 ministries for seamless multimodal connectivity. It focuses on identifying and filling infrastructure gaps in the movement of goods and services.

• Dedicated Freight Corridors (DFCs): The Eastern and Western DFCs are expected to significantly improve cargo movement efficiency, reducing turnaround times by 50% and lowering logistics costs.

• Multi-Modal Logistics Parks (MMLPs): 35 MMLPs are being developed under PPP mode to offer integrated warehousing, freight aggregation, and cold chain services across key trade corridors.

These reforms are expected to bring systemic efficiency, reduce lead times, and promote modal shift from road to rail and waterways, aligning India with global logistics standards.

2. Infrastructure Development

Indias logistics infrastructure is undergoing a massive transformation:

• Highway Expansion: As of FY25, India has built over 1.4 lakh km of national highways, with ongoing work under the Bharatmala project to add another 65,000 km, improving freight connectivity.

• Railway Modernization: Indian Railways is focusing on electrification, automation, and cargo-specific trains. The Dedicated Freight Corridors are game-changers in ensuring high-speed, low-cost logistics for long-haul cargo.

• Port-Led Development: Under the Sagarmala Project, over n6 lakh crore has been allocated for port modernization, hinterland connectivity, and new coastal logistics hubs to boost EXIM trade efficiency.

• Air Cargo Infrastructure: With 23 airports now equipped with dedicated cargo terminals and cold chain facilities, India is becoming a competitive hub for time-sensitive logistics like pharmaceuticals and perishables.

3. E-commerce and 3PL Boom

Indias e-commerce sector, expected to reach USD 150 billion by 2026, has become a primary driver of demand for agile and responsive logistics. This has led to:

• Surge in Last Mile Delivery services, requiring micro-fulfillment centers and dense delivery networks.

• Emergence of 3PL and 4PL operators offering integrated warehousing, inventory, packaging, and distribution services.

• Focus on reverse logistics due to rising product return rates in fashion, electronics, and FMCG sectors.

As per a CBRE report (Q1 FY25), 3PL companies accounted for 40% of total warehousing space leasing in India, followed by e-commerce and retail players.

4. Technology-Driven Logistics

Digital transformation is central to Indias logistics growth story. Technologies like:

• loT and GPS for real-time shipment tracking

• Warehouse Management Systems (WMS) for inventory optimization

• Artificial Intelligence (Al) and Machine Learning (ML) for demand forecasting and route optimization

• Blockchain for supply chain transparency and documentation efficiency

• Robotic Process Automation (RPA) in warehousing

These are becoming standard practices across top-tier logistics providers, enhancing speed, reducing manual errors, and improving customer experience.

5. Cold Chain and Temperature-Controlled Logistics

Driven by the pharmaceutical, dairy, and processed food industries, Indias cold chain market is projected to grow at a CAGR of 14.8% to reach USD 53 billion by 2027. Key enablers include:

• Expansion of temperature-controlled warehouses and reefers

• Government schemes like PM Kisan Sampada Yojana and PLI for Pharma

• Rising demand for vaccine and biologics storage

States like Maharashtra, Gujarat, and Karnataka are emerging as key cold chain hubs due to their industrial clusters and port access.

6. Sustainability and Green Logistics

Environmental considerations are gaining importance. Green logistics practices are being adopted, such as:

• Introduction of electric delivery vehicles (EVs) and CNG trucks

• Solar-powered warehouses

• Emphasis on modal shift to rail and waterways

• Government support for Battery Swapping Policy and FAME II scheme to accelerate EV adoption in freight These efforts are critical for aligning the Indian logistics industry with global climate goals.

The Indian container logistics market is undergoing a significant transformation, driven by rising EXIM trade, government- led infrastructure development, and growing demand for efficient multimodal transport. With containerized cargo volumes reaching approximately 19.6 million TEUs in FY24 and expected to grow at a CAGR of 8.1% through 2029, the sector is poised for steady expansion. Strategic initiatives such as the Dedicated Freight Corridors, the Sagarmala programme, and investments in ICDs and smart port infrastructure are helping reduce dwell times and improve cargo turnaround, especially in key trade corridors.

The Indian container logistics market is entering a high-growth phase, supported by favorable policy reforms, infrastructure upgrades, and trade expansion. For logistics service providers like Total Transport Systems Limited, this presents an enormous opportunity to scale operations, enhance service offerings, and deepen integration with Indias global trade ambitions. By investing in multimodal capabilities, technology, and regional connectivity, TTSL is set to remain a key enabler in Indias containerized logistics ecosystem.

About Total Transport Systems Limited (TTSL)

Company Overview

Total Transport Systems Limited (TTSL) is a leading player in the global logistics and multimodal transport segment, offering integrated and end-to-end logistics solutions across ocean, air, and surface transport. Founded with the vision of simplifying global supply chains, TTSL has built a strong reputation for reliability, cost efficiency, and customer-centric service. Over the years, the company has developed deep operational expertise in Less-than-Container Load (LCL) consolidation, Full Container Load (FCL) forwarding, air cargo handling, and last-mile delivery, while strategically expanding its footprint across India and key international markets.

Headquartered in Mumbai, TTSLs infrastructure includes Container Freight Stations (CFSs), Inland Container Depots (ICDs), bonded warehouses, and an extensive network of transport partners, agents, and offices. The companys comprehensive presence across ports, ICDs, and major industrial hubs ensures uninterrupted cargo flow, contributing to Indias trade competitiveness.

Core Business Segments

1. LCL Consolidation (Less-than-Container Load)

TTSL is among Indias largest neutral LCL consolidators, offering weekly consolidation services from over 20 major ICDs and gateway ports to global destinations. Its LCL business has witnessed significant growth, driven by:

• SME export support

• Strong overseas agent networks

• Competitive transit times and pricing

2. FCL Forwarding (Full Container Load)

The companys FCL services cater to large exporters and importers, offering seamless door-to-door containerized transport. In FY25, TTSLs FCL volumes more than doubled YoY ? a reflection of enhanced demand and the companys growing capacity to tap global routing efficiencies.

3. Air Cargo

TTSL handles over 1 lakh kilograms of air freight monthly, serving critical and time-sensitive industries like pharmaceuticals, electronics, and fashion. The companys air freight division focuses on leveraging strong relationships with global carriers and offering customized clearance, packing, and warehousing services.

4. Last-Mile Delivery (LMD) - Abhilaya

Launched under the brand name “Abhilaya,” TTSLs foray into the last-mile logistics space marks a strategic diversification. This tech-enabled LMD platform handles millions of shipments per month across Pan India, serving e-commerce, fintech, and D2C clients.

Key Strengths and Competitive Advantages

• Multi-modal Capability: Integrated services across sea, air, and land transport, enabling end-to-end visibility and operational control.

• Pan-India Network: Presence at all key ports, ICDs, and metros with strategically located warehouses and partners.

• Technological Edge: Real-time tracking, digital documentation, automated invoicing, and ERP-backed service delivery.

• Strong Client Base: Serves a diversified portfolio of clients across manufacturing, automotive, pharma, textiles, and retail sectors.

• Scalability: Strong financials and operational flexibility allow TTSL to scale quickly across new geographies or verticals.

Strategic Initiatives and FY25 Highlights

• LCL Expansion: Launched export LCL service from South Gujarat, addressing long-pending trade needs in the region.

• Digital Innovation: Invested in enhancing digital platforms for clients and internal teams, improving service turnaround and visibility.

• Global Expansion: Initiated groundwork for entering select African markets, starting with Ghana, aligned with its long-term globalization roadmap.

• Operational Efficiencies: Improved turnaround time, reduced cargo dwell time, and strengthened vendor partnerships for faster execution.

Total Transport Systems Limited continues to align with these sectoral shifts by strengthening its presence in both FCL and LCL container movement, leveraging key inland hubs like Ankleshwar and forging strong port connections. With technology integration, enhanced last-mile delivery capabilities, and a customer-centric approach, TTSL is well-positioned to capitalize on emerging growth opportunities in Indias evolving container logistics landscape.

Financial Performance of the Company for FY25

Total Transport Systems Limited delivered a resilient performance in FY25, despite continued macroeconomic headwinds and global freight volatility. The Company remained focused on operational efficiency, strategic diversification, and strengthening its logistics capabilities across multimodal platforms.

During the year ended March 31,2025, the Company recorded a consolidated revenue of Rs. 665.2 crore, reflecting a decline from the previous year primarily due to subdued global freight rates and reduced average realizations per shipment. Despite this, the Company successfully protected its operating margins through cost optimization and increased contribution from high- margin segments such as LCL consolidation and Last-Mile Delivery (LMD).

The Profit After Tax (PAT) stood at Rs. 8.8 crore, marking a recovery from the temporary dip observed in the first half of the year. EBITDA margins showed improvement sequentially in H2 FY25, supported by the scale-up in LMD volumes under the “Abhilaya” brand and better asset utilization across ICD-linked routes.

The Company maintained a prudent capital structure, with healthy liquidity and minimal long-term debt. Investments were directed toward technology integration, route expansion, and enhancing cross-dock infrastructure to support future growth.

As the Company looks ahead to FY26, the focus remains on scaling up international operations, expanding the 3PL segment, and enhancing service quality to drive revenue recovery and long-term profitability.

Volume wise comparison of summary is given below:-

Vertical	FY 2025	Volume in Unit	FY2024	Volume in Unit
Sea Export:
FCL	14,534	TEU	11,989	TEU
LCL	2,66,471	CBM	2,46,628	CBM
Sea Import:
FCL	2,528	TEU	2,838	TEU
LCL	1,56,672	CBM	1,59,370	CBM
Air Export	1,187	Ton	1,101	Ton
Air Import	184	Ton	211	Ton

Opportunities and Threats Opportunities

1. Growth in Indias EXIM Trade

With Indias merchandise exports exceeding USD 450 billion in FY24 and a growing focus on free trade agreements (FTAs), there is a sustained rise in demand for integrated freight forwarding services. TTSL, with its strong LCL and FCL capabilities, stands to benefit directly from increased containerized export volumes.

2. Expansion of E-commerce and Last-Mile Delivery

The exponential growth in Indias e-commerce sector (projected to reach USD 350 billion by 2030) fuels the need for scalable last-mile solutions. TTSLs “Abhilaya” has already shown strong performance alone, positioning it well to capture more market share in Tier 2 and Tier 3 cities.

3. Infrastructure and Policy Reforms

Government initiatives such as the National Logistics Policy (NLP), PM Gati Shakti, and Sagarmala are transforming the logistics landscape. Projects like Dedicated Freight Corridors (DFCs) and modern ICDs open up faster, more cost- effective routing options that TTSL can leverage to improve margins and expand services.

4. Digitalization and Tech-Driven Services

Increased adoption of digital logistics platforms, AI-based route optimization, and real-time tracking solutions provides opportunities for TTSL to enhance customer experience and operational efficiency. Its early investments in digital infrastructure position it as a preferred tech-enabled logistics partner.

5. International Expansion

The companys proposed entry into West African markets (e.g., Ghana) presents a significant growth avenue. As emerging economies increase trade with India, TTSL can play a key role in cross-border LCL and FCL logistics.

Threats

1. Volatility in Freight Rates and Global Supply Chains

Fluctuating freight rates due to global disruptions (e.g., Red Sea tensions, geopolitical conflicts, container shortages) impact profitability and predictability. Although TTSL has diversified operations, it remains exposed to global trade volatility.

2. Intense Competition and Price Pressure

The logistics sector in India is becoming increasingly crowded, with the entry of global logistics players and digital-first start-ups. This has led to price wars and margin compression, especially in commoditized services like FCL and last- mile delivery.

3. Infrastructure Bottlenecks and Last-Mile Challenges

While reforms are underway, challenges like port congestion, road bottlenecks, and underdeveloped last-mile infrastructure in remote areas continue to impact service levels. These can lead to increased transit times and higher operating costs.

4. Regulatory and Compliance Risks

TTSL must navigate a complex regulatory environment involving customs regulations, tax compliance (GST), shipping documentation, and cross-border trade laws. Frequent changes or delays in policy implementation can hinder smooth operations.

5. Dependency on Global Economic Cycles

Any slowdown in global demand, especially from key trade partners (e.g., the EU, USA, China), can directly impact cargo volumes. Sectors like textiles, electronics, and chemicals, which contribute significantly to TTSLs volumes, are vulnerable to global economic swings.

SEGMENT- WISE OR PRODUCT- WISE PERFORMANCE

The Company is engaged in the business of Consolidation/deconsolidation of cargo freight forwarding, logistics, warehousing and transportation along with last mile delivery business. The Company is dealing only in this single segment and hence segment wise performance is not applicable to the Company.

RISKS AND CONCERNS

Like every business, the Company faces risks, both internal and external, in the undertaking of its day-to-day operations and in pursuit of its longer-term objectives. A detailed policy drawn up and dedicated risk workshops are conducted and key support functions wherein risks are identified, assessed, analyzed, and accepted / mitigated to an acceptable level within the risk appetite of the organization. The risk registers are also reviewed from time to time.

The Company faces the following Risks and Concerns:

Credit Risk

To manage its credit exposure, TTSL has determined a credit policy with credit limit requests and approval procedures. Company does its own research of clients financial health and project prospects before bidding for a project. Timely and rigorous process is followed up with clients for payments as per schedule. The Company has suitably streamlined the process to develop a focused and aggressive receivables management system to ensure timely collections.

Interest Rate Risk

The Company has judiciously managed the debt-equity ratio. It has been using a mix of loans and internal cash accruals. The Company has well managed the working capital to reduce the overall interest cost.

Competition Risk

This risk arises from more players wanting a share in the same pie. Like in most other industries, opportunity brings with itself competition. We face different levels of competition in each segment, from domestic as well as multinational companies. The Company has created strong differentiators in project execution, quality and delivery which make it resilient to competition. Furthermore, the Company continues to invest in technology and its people to remain ahead of the curve. A strong, stable client base consisting of large and mid-sized corporations further helps to insulate the Company from this risk.

Liability Risk

This risk refers to our liability arising from any damage to cargo, equipment, life and third parties which may adversely affect our business. The Company attempts to mitigate this risk through contractual obligations and insurance policies.

INTERNAL CONTROL SYSTEMS AND ADEQUACY

The Company implemented proper and adequate systems of internal control to ensure that all assets are safeguarded and protected against loss from any unauthorized use or disposition and all transactions are authorized, recorded and reported correctly. The Company also implemented effective systems for achieving highest level of efficiency in operations, to achieve optimum and effective utilization of resources, monitoring thereof and the compliance with provisions all laws including the Companies Act, 2013, Listing Agreement, directions issued by the Securities and Exchange Board of India, labour laws, tax laws etc. It also aimed at improvement in financial management, and investment policy. The System ensures appropriate information flow to facilitate effective monitoring. The internal audit system also ensures formation and implementation of corporate policies for financial reporting, accounting, information security, project appraisal, and corporate governance. A qualified and independent Audit Committee of the Board of Directors also reviews the internal control system and its impacts on improvement of overall performance of the Company.

HUMAN RESOURCES

The Companys HR philosophy is to establish and build a high performing organization, where each individual is motivated to perform to the fullest capacity: to contribute to developing and achieving individual excellence and departmental objectives and continuously improve performance to realize the full potential of our personnel. As on March 31, 2025, Company is giving direct employment to 399 employees.

OUTLOOK

The Indian logistics sector stands as one of the worlds largest and plays a crucial role in driving economic growth. Following a 2% contraction in FY21, the market experienced a robust post-COVID recovery in FY22, witnessing a remarkable 14% growth and reaching a value of US$435 billion. As per the projections from EY, a leading global consulting firm, the logistics market in India is poised to expand further, reaching US$591 billion by FY27.

According to an EY report titled ‘India@100, Indias GDP is estimated to be around US$ 26 trillion in market exchange rate terms by 2047-48. The transportation and logistics sector are expected to play a crucial role in supporting the countrys ambitious growth targets. As India aims to reach this milestone over the next 25 years, the transportation and logistics industry would be essential for enabling this growth as logistics cost as a % of GDP accounts for currently. The considerable expenses in the logistics industry can be ascribed to the fact that most freight movement in India depends on road transportation, which constitutes 66% of cargo in ton-kilometres. Rail transportation comes next with a share of 31%, whereas shipping and air transportation comprise only 3% and 1%, respectively. However, the distribution of freight transportation varies across sectors.

Organised players are anticipated to exhibit a notable CAGR of approximately 32% between 2022 and 2027. Consequently, their market share is expected to reach 12-15% by FY27. This transformation is expected to be led by organised players capacity to provide integrated services, leverage network- and scale-driven efficiencies, and make substantial investments in technology and engineering. These efforts are projected to promote their market competitiveness and capture a larger share of customer business.

Source: https://www.ibef.org/research/case-studv/transforming-india-s-logistics-sector-challenges-and-opportunities

In accordance with the SEBI (Listing Obligations and Disclosure Requirements) (Amendment) Regulations 2018, the Company is required to give details of significant changes (Change of 25% or more as compared to the immediately previous year) in key sector specified financial ratio.

PARTICULARS	STANDALONE			CONSOLIDATED
	F.Y. 25	F.Y. 24	Variation	F.Y. 25	F.Y. 24	Variation
Debtors Turnover ratio	7.13	5.94	19.89	7.18	6.29	14.18
DEBT/EBIDTA	1.32	1.54	-14.62	1.97	2.50	-21.34
Interest Coverage ratio	5.95	3.21	85.64	2.42	1.83	32.11
Current Ratio	1.78	1.79	-0.89	1.60	1.64	-2.36
Debt-Equity Ratio	0.28	0.28	1.78	0.47	0.44	5.89
Operating Profit Margin	0.14	0.17	-17.02	0.28	0.32	-12.90
Net Profit Margin	0.02	0.02	27.14	0.01	0.00	415.19
Return on Net worth	0.70	0.39	79.28	0.55	0.08	602.16

COMMENTS ON RATIO:-

1) The reason for increase in Interest Coverage ratio is majorly because of increase in profit in the current year as compared to previous year.

2) The reason for increase in Net Profit ratio is majorly because revenue has increased substantially in the current year as compared to previous year.

3) The reason for increase in Return on networth ratio is majorly because profit has increased substantially in the current year as compared to previous year