Presented by

Salman Mohammed Shiras

MBA FA I

Logistics

Temperature
Control

Cold Chain
Logistics

A cold chain is a temperature-controlled supply chain.

An unbroken cold chain is an uninterrupted series of storage and distribution activities which

maintain a given temperature range.

It is used to help extend and ensure the shelf life of products such as fresh agricultural produce,

seafood, frozen food, photographic film, chemicals, and pharmaceutical drugs.

Uses product specific environment parameters.

 Manufacturers
Precooling System

Reefers
Refrigerated railway wagons
Refrigerated cargo containers

End
Customers

Hotels, airports, ports,

factory, markets etc.

Cold Storages
Warehouses
Value Added Services

Transport

Reefers
Refrigerated railway wagons
Refrigerated cargo containers

 Various industries covered under cold chain comprise agriculture, horticulture and floriculture,

dairy, confectionery, pharmaceuticals, chemicals and poultry, among others.

Highly fragmented 3500 players in unorganized sector & 30 players in organized sector.
Organized players account for only ~810% of cold chain revenues.
There are approximately 6,300 cold storages in India designed originally for single commodity

storage.
75 percent of the cold storage capacity is used to store potatoes, while only 23 percent fall in

the multi-product category.

65% of Indias cold chain storage capacity is contributed by Uttar Pradesh and West Bengal.
The current capacity is capable of handling less than 11% of what is produced.

Strengths

Weakness

Backbone of industries
Essential to preserve the quality of
products

High barriers to entry

Highly fragmented
Low technology penetration
Lack of trained manpower

SWOT ANALYSIS
Opportunities

Emphasis on exports
Growth of organized retail
Growth of end segments
Demand of pharmaceutical sector
Government Initiatives

Threats
Highly capital intensive
Lack of infrastructure

 Recognized as sunrise sector.

Less than 10% of produce pass through a cold chain.

The Indian cold chain industry, expected to grow at a CAGR of ~28% over the next four

years and reach a market size of ~USD 13 billion in 2017.

Shift in technology of construction from conventional brick wall construction to sandwich

insulated panel and reinforced concrete (RCC) structures to pre-engineered buildings

(PEB) steel structures.
Energy-efficient practices like energy recovery systems, energy-efficient designs of

refrigeration equipment and automation.

Introduction of green technology & use of renewable energy
Development of reefer infrastructure in view of Indias exports thrust and potential.

 Snowman Logistics Limited, founded in 1993, is an integrated pan-India temperature-

controlled logistics services provider.

Distribution network comprises primary and secondary transportation supplying, amongst

others, to QSRs, retail outlets, restaurants and hotels within a city.

Largest promoter and shareholder Gateway Ditriparks Limited.
Other shareholders are Mitsubishi Corporation, Mitsubishi Logistics Corporation, International

Finance Corporation and Norwest Venture Partners.

Manages 28 temperature-controlled warehouses across 15 locations [as of 31 March 2015].
Successfully completed the IPO in August 2014 at a price of Rs. 47. The issue was

oversubscribed ~60 times.

The Companys shares were listed on the BSE and the NSE in September 2014.

 Snowmans

integrated source to stores operation comprises warehousing, primary

distribution, secondary distribution and value-added services (kitting, labelling, sorting and
bulk breaking).

Offers services across a spectrum of temperature- from ambient to chilled and frozen (i.e.-

25C to +20C).
Blast freezing facilities at temperature controlled warehouses in Bengaluru, Chennai,

Visakhapatnam, Kolkata, Mumbai, Ahmedabad, Delhi, Chandigarh and Surat.

During the year, warehousing capacities were added at Mumbai, Chennai, Bhubaneswar, Pune,

Surat and Visakhapatnam, taking the total installed capacity from 61,700 pallets at the start
of the year to 85,500 pallets which is a growth of 39%.

 The Indian cold chain industry, expected to grow at a CAGR of ~28% over the next four years

and reach a market size of ~USD 13 billion in 2017.

Unorganized nature provides a vast opportunity.
Focus on multipurpose cold storages.

Focus on express distribution.

Potential future markets - F & V processing, pharma and e-commerce.

Ratio Analysis
Ratio

Formula

2015

2014

Fixed Asset Turnover ratio

Revenue/ Average Fixed Assets

10.46

1.59

Current ratio

Current Assets/ Current Liabilities

3.18

0.82

Debt-Equity ratio

Total Debt/Total Shareholder's Equity

0.17

0.59

Financial Leverage ratio

Average Total Assets/ Average Total Equity

1.31

1.75

Interest Coverage ratio

EBIT/ Interest Payments

2.19

2.22

Net Profit margin

Net Income/ Revenue

12.19

15.14

Operating Profit margin

EBIT/Revenue

23.17

24.77

Return on Assets

Net Income/ Average Total Assets

25.09

17.83

Return on Equity

Net Income/ Average Total Equity

0.059

0.101

Return on Total Capital

EBIT/ Average Total Capital

0.02

0.07

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