Indian warehousing and logistics sector is booming. JLL India reports that the warehousing and logistics sector in the country received a whopping investment of Rs 1,438 crore through two major deals in 2015. This made the overall foreign private equity (PE) inflow into the sector more than even the sum of five deals - Rs 1,350 crore - that took place in 2012. The government initiatives in making the policy environment conducive and strengthening of the e-commerce logistics platform post-2014, seems to have resulted in an investment comeback - as seen in 2015. The report says, ´The promise of high growth in warehousing and logistics is luring both foreign investors but also private equity firms to India. Policies allowing 100 per cent foreign direct investment (FDI) in warehouses and food storage facilities under automatic routes (where manufacturers can sell their products online directly) as also declaring some zones to be tax-free (i.e. free trade warehousing zones or FTWZs), has made the sector appear on the foreign PE investment radar.´
Driven by many global logistics and e-commerce players entering the Indian arena, in general merchandise, perishables, pharmaceuticals and environment sensitive goods, electrically operated material handling equipment market is expected to grow exponentially. As such, the market is ripe for battery manufacturers to encash from the upcoming opportunities in both OEM and aftermarkets.
Many leading MHE and solutions providers are already offering such products fitted with suitable imported batteries. A golden opportunity for Indian battery makers to upgrade their product lines to provide made in India low cost but equivalent substitutes for higher voltage, high capacity and long lasting batteries used in such equipment, beginning in the aftermarket space and later graduating to OEM suppliers.
On a positive note, Indian industry has already tasted success in terms of business excellence and profitably through use of low cost but highly efficient warehousing and logistics supply chains in some parts of the country. Expansions in other areas are already under implementation. Therefore, more equipment will be required, hence more demand for MHE batteries.