15 October 2012
Initiating Coverage | Sector: Logistics
Container Corporation of India
On high ground
Siddharth Bothra
(Siddharth.Bothra@MotilalOswal.com); +91 22 3029 5127

Container Corporation of India
Container Corporation of India: On high ground
Page No.
Summary
............................................................................................................
3
Story in charts
................................................................................................
4-5
Set to further expand its inimitable moat
.................................................
6-11
Industry background
.................................................................................
12-14
Multiple medium-to-long-term triggers................................................... 15-22
Leveraging strategic JVs to provide total logistics services
.....................
23-24
Financials robust despite higher competition
.........................................
25-33
Initiating coverage with Buy
.....................................................................
34-39
Financials and valuation
...........................................................................
40-41
15 October 2012
2

15 October 2012
Initiating Coverage | Sector: Logistics
Container Corporation of India
BSE SENSEX
S&P CNX
18,793
5,705
CMP: INR1,048
On high ground
TP: INR1,250
Buy
Key beneficiary of GoI’s thrust on Indian Railways to correct freight modal
mix / key reforms; competition unable to mimic success
Bloomberg
Equity Shares (m)
1,6,12 Rel. Perf. (%)
M.Cap. (INR b)
M.Cap. (USD b)
CCRI IN
130.0
3/0/-7
130.9
2.5
52-Week Range (INR) 1,057/805
Valuation summary (INR b)
Y/E March
2012 2013E 2014E
Sales
41.0 44.5 49.9
EBITDA
10.2 11.3 13.0
NP
8.7
9.4 10.0
EPS (INR)
66.6 72.4 77.0
EPS Gr. (%)
-1.2
8.7
6.3
BV/Sh. (INR) 427.4 480.0 536.1
P/E (x)
14.0 12.9 12.1
P/BV (x)
2.2
1.9
1.7
EV/EBITDA (x) 10.6 10.1
8.8
EV/Sales (x)
2.7
2.6
2.3
RoE (%)
16.5 16.0 15.1
RoCE (%)
22.3 21.0 20.0
Prices as on 11 October 2012
Over FY13-17, CCRI would be a big beneficiary of (1) the government’s focus on Indian
Railways to correct freight transport modal mix, (2) infrastructure projects like the DFC
and container port capacity expansions, and (3) key reforms such as GST and FDI in retail.
Since 2006, ~15 new players have entered the container train operation (CTO) business.
However, none of them have been able to mimic CCRI’s success.
By virtue of its legacy pan India strategic assets, CCRI enjoys an inimitable resource
advantage over its peers, which is steadily increasing with time.
While concerns such as high empties cost and muted near-term growth outlook remain,
the long-term prospects are favorable for CCRI and outweigh near-term concerns. We
initiate coverage with a Buy rating.
Set to further expand its inimitable moat
By virtue of its legacy low cost pan India strategic assets, Container Corporation
of India (CCRI) enjoys an inimitable resource advantage over its peers, which is
steadily increasing with time. None of the 15-odd new players that have entered
since the container train operation (CTO) industry was opened in FY06 have even
achieved minimum economies of scale. CCRI is implementing preemptive capex
of INR62b, which will not only further enhance its competitive advantage, but
also allow it to position itself as a total logistics player.
Multiple medium-to-long-term triggers
CCRI is one of the best proxies to play multiple themes such as (1) infrastructure
thrust, especially investments aimed at correcting the freight transport modal
mix, (2) reforms – GST, FDI in Retail, and (3) ongoing structural trends –
containerization, shift from road to rail. Successful execution of proposed
infrastructure capex and key reforms could result in container rail traffic growing
at 17.6% over FY13-18. As the undisputed leader, CCRI should benefit the most.
We expect CCRI’s volumes to grow at a CAGR of 17.1% over FY13-18.
Shareholding pattern (%)
As on
Jun-12 Mar-12 Jun-11
Promoter 63.09
63.09 63.09
Dom. Inst 7.09
7.31
7.24
Foreign
25.55
25.65 26.51
Others
4.28
3.96
3.16
Stock performance (1 year)
Leveraging strategic JVs to provide total logistics services
CCRI’s key strength is its ability to provide single window facility for multimodal
logistics services. It is able to do so through its strategic JVs with its customers
(GDL/Allcargo), port operators (APM/ DPI), road haulers (TCI), air cargo (HALCON/
GVK) and shipping lines (Maersk).
Initiating coverage with Buy
We believe CCRI’s inimitable pan India network provides it with a significant
moat, which coupled with positive long-term industry prospects, will allow it to
enjoy a prolonged period of growth. We believe DCF is the best way to capture
the intrinsic value of CCRI, given its stable cash flow, consistent payout ratio,
robust operational RoCE and low reinvestment requirements. Initiate coverage
with a
Buy
rating and a target price of INR1,250 (upside of 19.3%).
3
Investors are advised to refer
through disclosures made at the end
of the Research Report.
15 October 2012

Container Corporation of India
Story in charts Key beneficiary of thrust to correct freight modal mix
Unfavorable transport modal mix with high reliance
on roadways hinders India's GDP growth by ~2%.
The share of container trade is steadily
increasing, but is still significantly lower than
world average
There is now a concentrated effort to correct this
imbalance, which is reflected in the sharp increase
in allocation for the transport sector in the
successive five-year plans.
Concentrated effort to correct India's modal mix (%)
Rail transport is cheaper over longer
distances (cost)
The share of Indian Railways in container traffic
will increase sharply post the implementation of
the Dedicated Freight Corridor.
Air
Water
Rail
<1
6
36
Air
Water
Rail
<1
5
25
Air
Water
Rail
<1
6
46
69
Road
57
Road
Road
47
(Kilometers)
FY10
From current
trajectory…
… to balanced
modal mix
Source: KPMG, McKinsey, IPA, MOSL
Proposed allocation for infrastructure/ transport sector in the 12th Plan to help correct freight modal mix
Twelfth
Planned expenditure on transport
infrastructure is expected to be about
INR13,750b. Assuming the split
remains similar to the 11th Five-year
Plan, it would amount to INR7,013b in
roads, INR4,813b in railways, INR963b
in ports and INR963b in airports
Source: Indian Planning Commission, KPMG
Share of container trade steadily increasing (%)
Share of Indian Railways in container traffic low
Source: IPA, IR, MOSL
15 October 2012
4

Container Corporation of India
Story in charts CCRI best placed to benefit from emerging opportunities
Since 2006, ~15 new players have entered the CTO
business. However, none of them have been able
to mimic CCRI's success.
Core RoCE would be under some pressure due to
major preemptive capex, but should bottom FY15.
Over FY02-12, its OCF and FCF have grown at a
CAGR of 12% and 17%. Post the completion of its
preemptive capex by FY16-17, we expect CCRI to
enter a sweet spot of sustainable and robust FCF,
which should lead to sharp improvement in its
payout ratio.
Over FY13-17 CCRI is undertaking preemptive
capex of ~INR62b over FY13-17, which is aimed at
increasing its competitive advantage in the CTO
industry and establishing itself as a total
multimodal logistics player.
Competitors unable to mimic CCRI's success
Rakes Terminals
(Nos.)
(Nos.)
Volumes (m TEU’s)
Total
EXIM Domestic (m TEU’s)
Value
(INR b)
41
5
3
10
58
70
EBIT
(INR b)
9.3
0.3
0.4
1.2
11.3
82
EBIT Capital Emp
(%)
(INR b)
22.9
7.7
16.4
11.7
19.4
RoC
(%)
Concor
253
63
2.1
0.5
2.6
Gateway Rail*
24
3
0.2
0.0
0.2
Arshiya International**
20
1
-
0.1
0.1
Others
90
3
0.5
0.0
0.6
Total
387
70
3
1
3
Concor's Share (%)
65
90
76
70
75
# Net of cash, *Faridabad to start in 3QFY13, **Khurja to start in 3QFY13
28.6#
33
6.9
5
6.8
7
24.3
5
66.6
17
43
Source: Company, MOSL
Preemptive capex plans for FY13 and FY13-17 to further increase its competitive moat (INR b)
FY13
FY13-17
Source: Company, MOSL
Core RoCE to bottom in FY15
FCF to increase sharply from FY16
Source: Company, MOSL
15 October 2012
5

Container Corporation of India
Set to further expand its inimitable moat
Competitive intensity abating; emerging as a total logistics player
By virtue of its legacy low cost pan India strategic assets, CCRI enjoys an inimitable resource
advantage over its peers, which is steadily increasing with time.
None of the 15-odd new players that have entered since the container train operation
(CTO) industry was opened in FY06 have even achieved minimum economies of scale.
CCRI is implementing preemptive capex of INR62b, which will not only further enhance its
competitive advantage, but also allow it to position itself as a total logistics player.
Enjoys inimitable resource advantages
Incorporated in 1988 as a state-owned entity under the Ministry of Railways, CCRI had
the benefit of obtaining Indian Railways’ surplus land at strategic locations at very
attractive long-term lease rates. Till 2006, when private operators were permitted
and licensed to enter the container rail business, it was the monopoly player. CCRI’s
first mover advantage and legacy low cost strategic rail assets give it inimitable
resource advantages over its peers, which are steadily increasing with time.
Key success factors for a container train operator (CTO)
Extensive pan India asset network of rail terminals / container freight stations
(CFSs) / inland container depots (ICDs) at strategic trade locations
Relationships with major international shipping lines
Ability to offer multi-modal services
Has the largest rail terminal network in India
The nature of the CTO
business is such that
higher volumes can be
captured only if a player
has access to a wide
network to handle and
consolidate freight
The nature of the CTO business is such that higher volumes can be captured only if a
player has access to a wide network to handle and consolidate freight. CCRI has ~63
rail terminals at strategic locations across the country. Of these, 18 are pure EXIM
terminals, 33 are combined terminals and 12 are pure domestic terminals. Rail terminal
yards allow consolidation of cargo and enable implementation of the hub and spoke
model. They also enable value addition and drive cost efficiencies.
Setting up a rail terminal is not only capex intensive but also involves the arduous
task of (a) acquiring large contiguous land in close proximity to the railway track for
inland container depots (ICDs) and near ports for container freight stations (CFSs),
and (b) procuring regulatory approvals from the central government and linkages
from Indian Railways. Even six years after 15 private CTOs entered the business, they
have cumulatively set up only ~7 terminals.
Though its competitors have added ~134 rakes, ~55% of CCRI's rake capacity of ~253
rakes, they have failed to capture a proportionate share of volumes or industry profits.
Thus, they have been unable to mimic CCRI's financial success. While there are two
key terminals in the NCR region by GDL (at Faridabad) / Arshiya (at Khurja), that are
slated to get operational by 3QFY13 and another 12-15 terminals at planning/
implementation stage by various other CTO players, none of the competitors are
likely to have the network presence to pose any major challenge to CCRI's dominance
in the medium term.
15 October 2012
6

Container Corporation of India
CTOs in India - a snapshot
Name
Adani Logistics
Concor
CRRS*
CWC
ETA Star Group
Gateway Rail
Freight
Hind Terminals
Group
Adani
IR#
DPW
PSU
Dubai
GDL
MSC
Rakes
6
253
8
-
11
21
14
Rail
Terminals
2
63
-
-
-
3
-
Exim Domestic Locations
(%)
(%)
33
80
100
100
80
84
100
67
20
-
-
20
16
-
Gurgaon/
Kishangarh
Pan India
Other Activities
Ports, Container terminals,
CTO, CFS
Multi modal operator
Ports, Container terminal
Warehousing, CFS
Shipping and port services
CFS, CTO
Shipping/ Freight Forwarding
Container shipping, infra
CFS, container terminal
Container terminal, CFS,
Trucking
Fertilizers
Ludhiana/ Mumbai/
Faridabad
India Infra.
APL
9
-
SICAL Logistics
-
8
-
Boxtrans (India)**
JM Baxi & Co.
12
-
TransRail Logistics -
2
-
Arshiya Rail Infra.
-
20
1
KRIL
-
8
-
Inlogistics
NOL, Singapore
15
-
Total
387
69
Concor Share (%)
65
91
*Container RAIL Road Services; **Boxtrans (India) Logistics
98
2
-
100
10
90
-
100
5
95 Khurja
4
96
-
-
76
24
76
70
Services, #IR: Indian Railway
Source: Industry, MOSL
Favorably placed with respect to power centers in the industry
The importer or exporter typically appoints a shipping company (like Maersk,
Mediterranean Shipping, etc) or a third-party logistics provider (3PL), which in turn
engages ancillary service providers such as CTOs. The hypothetical cost break-up of a
typical container movement between India and US is: ocean freight 58%, destination
delivery 15%, surcharges and taxes 15%, and others ~12%. The CTO accounts for a
small proportion of an exporter/importer’s overall logistics costs.
The three key power centers in the CTO value chain are: (1) international shipping
lines/alliances, (2) Indian Railways, and (3) pan India rail terminal network owners.
Unless, a player has some inimitable advantage with respect to one or more of these
power centers, it is likely to get squeezed and fail to appropriate the value created on
a sustained basis.
According to industry
estimates, ~75% of the
global cargo capacity is
controlled by 12-15
international shipping
lines/alliances
1. International shipping lines/alliances:
According to industry estimates, ~75% of
the global cargo capacity is controlled by 12-15 international shipping lines/
alliances. They use their power to squeeze counterparty prices, switch between
rail/road, etc. Unless a CTO has a wide network and large scale, it will be unable to
capture the EXIM business, which constitutes ~75% of the CTO market and is
significantly more profitable.
2. Indian Railways:
Indian Railways is the sole owner of the rail network and the sole
haulage service provider in India. Since 2006, when private sector companies were
allowed to enter the CTO industry, Indian Railways has increased haulage charges
by ~23%. Haulage charges constitute 70-75% of a CTO’s overall costs and unless a
player has reasonable pricing power, it will not be in a position to pass through
the frequent increases in haulage charges.
7
15 October 2012

Container Corporation of India
3. Pan India rail terminal network owners:
A pan India rail terminal network owner
like CCRI is able to (1) withstand the bargaining power of international shipping
lines/alliances, and (2) pass through the increases in Indian Railways’ haulage
charges. This allows it to retain the value created on a sustainable basis and enjoy
attractive returns on its capital employed.
Understanding the CTO value chain
Sourcing & Intermediation
Exporter /
Producer
Outbound Cargo Handling
& Domestic Receipt
Air Cargo Centre
Central Warehouse
ICD
(Container Cargo)
CFS
(Container Cargo)
Customs House
Agent
Outgoing Port
Shipping Line
Legend:
Transport Mode:
Road
Rail
Air
Sea
Intermediary Type:
Service Providers
Infrastructure Points
End Users
Source: KPMG Analytics
Transit Airport
Local Warehouse
/ Pick Up Point
Consumer
Bulk / Break
Bulk Cargo
Inbound Cargo Handling
& International Receipt
International
Airport
Central
Warehouse
Customs House
Agent
CFS / ICD
Importer
Local Warehouse
/ Pick up point
Express Cargo Agent
Freight Forwarder
Local
Factory
Yard /
Storage
Trucking Company
3PL / 4PL Agent
Key Activities:
Sourcing and
Intermediation
LTL / FTL
Management
NVOCC
Management
Arranging /
Broking
Tracking (GPS / IT)
Insurance
Key Activities:
Unloading
Inspection
Sorting
Storage
Consolidating /
Bulk Breaking
Stuffing / De-
stuffing
Customs Handling
/ Clearing
Documentation
Loading
Incoming Port
In a position to play the game strategically
The MES (volume)
needed to break even are
high, given that the
product is homogeneous
and demand exogenous
Setting up rail terminals is capital intensive. The minimum economies of scale
(volume) needed to break even are high, given that the product is homogeneous and
demand exogenous. Success primarily depends on achieving economies of scale,
operational excellence and low cost advantage (establishment cost for CCRI is just 2%
of sales). The size of most sub-markets is limited and setting up a terminal close to an
existing one divides the traffic. Since there is limited scope to create variance in
service offerings, there is risk of price-based competition, which lowers RoCE and
increases the gestation period. By virtue of its first mover and low cost resource
advantages, CCRI is in a position to play the game strategically.
15 October 2012
8

Container Corporation of India
Competition unable to mimic CCRI's success
Since 2006, when private operators were permitted into the CTO business, ~15 new
players have entered. These players were largely attracted by: (1) robust financials of
the incumbent (PAT margin of 20%; operational RoCE of ~40%), (2) growth potential of
the CTO industry, (3) confidence in their ability to create variance in service offerings,
and (4) underestimation of minimum economies of scale.
Most of these players have been unable to mimic CCRI’s success and have been forced
to curtail their expansion plans. This is because of a confluence of factors such as: (1)
shrinking EXIM business due to global economic turmoil, (2) poor economic returns
on capital employed, (3) difficulty in land acquisition for setting up rail terminals, and
(4) contraction of domestic market growth (trade shift to roadways) due to sharp
~22% increase in haulage charges by Indian Railways.
Comparative performance of key players
Rakes Terminals
(Nos.)
(Nos.)
Volumes (m TEU’s)
Total
EXIM Domestic (m TEU’s)
2.1
0.2
-
0.5
3
76
Khurja to
0.5
2.6
0.0
0.2
0.1
0.1
0.0
0.6
1
3
70
75
start in 3QFY13
Value
(INR b)
41
5
3
10
58
70
EBIT
(INR b)
9.3
0.3
0.4
1.2
11.3
82
EBIT Capital Emp
(%)
(INR b)
22.9
7.7
16.4
11.7
19.4
RoC
(%)
Concor
253
63
Gateway Rail*
24
3
Arshiya International**
20
1
Others
90
3
Total
387
70
Concor's Share (%)
65
90
# Net of cash, *Faridabad to start in 3QFY13, **
28.6#
33
6.9
5
6.8
7
24.3
5
66.6
17
43
Source: Company, MOSL
Initially, most of these players were able to expand the market by entering new and
under-serviced routes and concentrating on the neglected domestic market. Almost
10 of these players had initially tied up with CCRI to use its rail terminal network, with
few non-compete clauses. Faced with intense competition, CCRI took several strategic
measures to protect its market share: (a) reduction in tariffs for FEU (forty foot
equivalent unit) containers, (b) reduction in rates on selected routes, (c) introduction
of incentive schemes (volume discounts, bulk discounts, rebates, lower rates for
moving empty containers, and longer free time for clearing loaded containers), and
(d) strategic JVs to provide end-to-end logistics solutions. Since FY11, CCRI’s market
share has stabilized at ~75%.
Most of the
new entrants are not
making reasonable
returns on capital
employed and a few are
highly leveraged
Most of the new entrants are not making reasonable returns on capital employed and
a few are highly leveraged. Though one of the reasons for the low returns is the fact
that investments are front loaded, nevertheless, since competitors still far away from
reaching MES, the returns are likely to remain under pressure in the medium term.
On the other hand, the financial situation of CCRI remains robust (net cash of INR30b
+ operating cash flow of INR10b). As such, the competition does not pose a major
challenge to CCRI in the near term. While its competitors plan to cumulatively add
~18-20 rakes in FY13, CCRI alone intends to induct ~30 rakes during the year.
15 October 2012
9

Container Corporation of India
Volume comparison over FY07-12 (Industry v/s CCRI)
FY07
Indian Railways (m tons)
EXIM
Domestic
Total
% Change
EXIM
Domestic
Total
Concor (m TEU's)
EXIM
Domestic
Total
% Change
EXIM
Domestic
Total
Container Traffic by Ports
Railway Share of EXIM (%)
FY08
FY9
FY10
FY11
FY12
CAGR (%)
(FY07-12)
10.9
26.0
13.6
CAGR
(FY10-12)
7.3
-2.2
4.8
17.4
2.9
20.3
17.4
3.7
21.1
-0.1
28.9
4.1
23.3
7.1
30.3
33.9
88.5
43.6
1.9
0.5
2.3
-6.2
-3.6
-5.7
105
22
25.3
9.6
35.0
8.7
36.6
15.2
1.9
0.5
2.4
1.5
18.9
4.9
116
22
26.6
11.0
37.6
4.9
14.3
7.6
2.0
0.5
2.6
29.1
9.2
38.4
9.6
-16.4
2.0
2.1
0.5
2.6
1.7
0.4
2.1
1.9
0.5
2.5
15.3
20.7
16.3
103
17
4.5
3.7
4.3
6.5
-6.8
3.7
84
21
7.2
5.8
0.9
-13.9
5.8
1.6
132
142
11.1
10.6
20
21
Source: Company, MOSL, Indian Railways
CCRI EXIM growth has stabalized (YoY)
Domestic growth under pressure (YoY)
Source: Company, MOSL
Competitive intensity declining
CCRI’s market share has declined from 85% in FY08 to ~74% in 1QFY13. However, only
2-3 players (like GDL, Arshiya and Boxtrans) have been able to achieve any credible
scale and none of the new entrants have achieved minimum economies of scale.
Also, the incremental loss of market share for CCRI (gap between growth rates for
industry and CCRI) has reduced sharply over FY11-12. We expect this trend to sustain
and CCRI’s market share to become more resilient with competitive intensity abating.
New entrants seem to have underestimated minimum economies of scale:
The
new entrants seem to have underestimated minimum economies of scale. Based
on our industry interaction, we estimate the minimum economies of scale at ~45
rakes and 6-7 terminals spread across the country, with a high concentration in
the North-West. This implies minimum investment of ~INR13b (terminals: INR1.2b-
1.5b each and rakes: INR120m each).
10
The new entrants
seem to have
underestimated MES
15 October 2012

Container Corporation of India
CCI ruling brings increased clarity:
The recent ruling by Competition Commission
of India (CCI) on a case between Arshiya International and CCRI has increased
clarity on the rights of private players to use its rail infrastructure. Arshiya had
moved the Commission alleging that Indian Railways and CCRI work as a group
and indulge in exclusionary price discrimination and unfair trade practices. The
Commission ruled that there was no abuse of dominant position by the two
entities. However, it admonished Indian Railways for frequently changing its
haulage charges.
Emerging as a total logistics player
A multi-modal (sea, rail,
air, etc) service provider
has an edge over a
standalone operator
CCRI is implementing a preemptive capex of INR62b, which will not only further
enhance its inimitable competitive advantage, but also allow it to position itself as a
total logistics player. A multi-modal (sea, rail, air, etc) service provider has an edge
over a standalone operator. CCRI aims to provide a unique value proposition by offering
a multi-modal single window facility, coordinating with various agencies and services
involved in the containerized cargo trade. These include customers, gateway port,
railways, road haulers, consolidators, forwarders, custom house agents and shipping
lines. To achieve a high degree of customization, CCRI plans to offer packages designed
to provide the most cost effective combination.
Planned MMLP’s
Setting up 12 MMLPs across the proposed DFC alignment
CCRI is at an advanced stage to finalize INR7b-8b of land acquisitions in FY13 for
setting up 12 multimodal logistics parks (MMLPs) at strategic points across the proposed
Dedicated Freight Corridor (DFC) alignment. A multimodal logistics park (MMLP) is a
centralized place for all types of transportation activities and value-added services
required by exporters and local traders for shipment of goods. It also works as an
interlinking point for all modes of transport at one specific place. MMLP's would open
up several new business opportunities for CCRI in areas such as PFT/ SFTO, which is
currently not being captured in our estimates, due to lack of details.
New growth opportunities for CCRI
SCM/ 3PL
New
Opportunities
Cold Chain
(agriculture products)
Source: Company, MOSL
Khodiyar, Ahmedabad
Khatuwas, Rajasthan
Jharsuguda, Odisha
Quila Raipur, Punjab
Sriperumbuthur, Chennai
Kalinganagar, Odisha
Budhapank, Odisha
Pantnagar & Haridwar,
Uttarakhand
Visakhapatnam, AP
Krishnapatnam, AP
Palanpur, Gujarat
PFT/ Bulk Cargo
Air/ Ocean Freight
15 October 2012
11

Container Corporation of India
Industry background
Size of the industry
The size of India’s rail container transport operation (CTO) industry is ~38m tons in
volume terms and ~INR58b in value terms.
Industry segmentation
The CTO industry can be divided into two segments – EXIM and domestic. The
EXIM segment accounts for ~75% of the market while the domestic segment
accounts for ~25% of the market.
EBIT margins in the EXIM segment are high at 21-25% compared with 9-12% in the
domestic segment. The key reasons for this variance are: (1) the EXIM segment
enjoys higher terminal handling revenue due to customs, clearance, etc, (2) the
EXIM trade has more balanced up and down loads, leading to lower empties cost,
and (3) turnaround time for the domestic segment is high.
The north western part of India accounts for ~70% of the EXIM trade, with JNPT
alone handling ~41% of the container port traffic.
The traffic-handling capacity of major ports has increased at a CAGR of 13.4% from
504.7m tons in FY07 to 947m tons in FY12. During this period, most major ports
operated at a capacity of over 90%.
Liberalization of the industry
To carry out these
services effectively, it
was provided with land
by Indian Railways at
strategic locations where
trade originates
The domestic CTO industry was first liberalized in 1988, when Indian Railways
carved out its CTO operations, leading to the creation of Container Corporation of
India (CCRI). CCRI was established with the objective of facilitating primarily EXIM
container movement and providing other logistics services like one-window
customs clearing, ICD/CFS, etc. To carry out these services effectively, it was
provided with land by Indian Railways at strategic locations where trade originates.
On 5 January 2006, private sector companies were permitted to enter the industry,
with a view to attract a greater share of container traffic for Indian Railways and to
introduce competition in rail freight services. Indian Railways remains the sole
owner of the rail network and the sole haulage service provider in India.
Since 2006, ~15 new players (13 private and two state-owned) have entered the
industry. To satisfy the requirement of access to terminals, 10 of the 15 new CTOs
initially signed MoUs with CCRI.
The new CTOs were able to compete with CCRI, a monopoly service provider for
nearly 17 years, by offering value-added services. CCRI’s market share declined
from 85% in FY08 to ~75% in FY12.
Indian Logistics industry structure
Indian Logistics Market
Container Logistics
Market
Road Freight
Express Logistics
Liquid Logistics
CTO
ICD/ CFS
MTO
Source: Industry/MOSL
15 October 2012
12

Container Corporation of India
Industry structure: Homogeneous oligopoly market
Homogeneous Oligopoly Market
Top 4 players control >80% of the market
Nature of demand
Product homogenous
Demand exogenous
Nature of firm interaction
High interdependence
amongst firms
Oligopolies can retain
abnormal profits in the
long
run,
because
barriers to entry prevent
sideline firms from
entering market to
capture excess profits
Potential to differentiate
Firms sell similar goods
and services, which are
close substitutes and,
thus, price sensitive.
Ability to create service
variance limited
Coordination in industry
capacity so as to avoid
gluts
Competitive analysis for the CTO industry
Buyer Power - High
Buyers consolidated
Availability of possible
substitutes increases buyer
power
Switching cost low for buyers
Entry Barriers - High
Minimum economies of scale
(MES) high
High exit barriers due to high
capex intensity
Regulatory requirements
Access to favorable locations
Supplier Power - Medium
Multiple wagon
manufacturers
Many competing suppliers -
products standardized
Willingness to Pay
Value received by
customer
Substitutes - High
Alternatives to
railways exist, e.g.
road transport,
particularly for
shorter distances
Price
Value received by
firms in the industry
Cost
Value received
by supplier
Opportunity Cost
Rivalry amongst firms - High
Given homogenous product and exogenous demand,
competition is price based. Firms need to rely on operational
excellence and low cost advantage to distinguish themselves
and retain high returns. If competitors are weak, the market
could witness 'winner takes it all' kind of stuation.
Source: Company, MOSL
15 October 2012
13

Container Corporation of India
Container Traffic Growth with GDP
EXIM with Container Traffic Growth
FY02-12 CAGR - 23.7%
FY02-12 CAGR - 14%
Container Traffic vs Port Traffic (%)
Container Traffic vs Concor Exim Traffic (%)
FY02-12
CAGR - 9.4%
FY02-12
CAGR - 9.0%
India Export Break-up
India Import Break-up
Major vs Non Major share (%)
Port traffic mix (MT)*
*Report of Working Group for Port Sector for the 12th five year plan, Ministry of Shipping
15 October 2012
Source: IPA, Company, MOSL
14

Container Corporation of India
Multiple medium-to-long-term triggers
Infrastructure thrust, reforms, structural trends
CCRI is one of the best proxies to play multiple themes such as (1) infrastructure thrust,
especially investments aimed at correcting the freight transport modal mix, (2) reforms –
GST, FDI in Retail, and (3) ongoing structural trends – containerization, shift from road to rail.
Successful execution of proposed infrastructure capex plans and implementation of key
reforms could result in container traffic increasing by 17.6% over FY13-18.
Given that CCRI is the undisputed leader in the industry, it should benefit the most. We
expect CCRI's volumes to grow at a CAGR of 17.1% over FY13-18.
Infrastructure thrust; sharp increase in allocation to transport
It is estimated that India’s
transportation and
logistics bottlenecks
hinder its GDP
growth by ~2%
It is estimated that India’s transportation and logistics bottlenecks hinder its GDP
growth by ~2%. This is primarily due to the fragmented nature of the industry,
infrastructure constraints across transport modes, and an unfavorable modal mix,
with very high reliance on roadways. There is now a concentrated effort to correct
this imbalance, which is reflected in the sharp increase in allocation for the transport
sector in the successive five-year plans.
Proposed allocation for infrastructure/ transport sector in the 12th Plan
Twelfth
Planned expenditure on
transport infrastructure
is expected to be about
INR13,750b. Assuming
the split remains similar
to the 11th Five-year
Plan, it would amount to
INR7,013b in roads,
INR4,813b in railways,
INR963b in ports and
INR963b in airports
100% = INR5,785b
Planned spend
on Transport
Infrastructure
100% = INR2,568b
Source: Indian Planning Commission, KPMG
Indian Railways’ Vision 2020 aims to correct the modal mix
Currently, traffic flows
where rail transport is
structurally cheaper than
road transport account
for around two-thirds of
the total traffic
The route network of Indian Railways has expanded very slowly. In 1947, Indian
Railways inherited 53,996km of rail network, which stood at ~64,099km, an increase
of 10,000km over 62 years (FY10). Indian Railways’ Vision 2020 proposes to add
25,000km of new lines by 2020, supported by government funding and increase in
PPP. While road transport is the least expensive for distances up to 400km, rail and
waterways are cheaper for longer distances. Currently, traffic flows where rail
transport is structurally cheaper than road transport account for around two-thirds
of the total traffic.
15
15 October 2012

Container Corporation of India
Category-wise modal share (%)
Rail transport is cheaper over longer distances (cost)
Concentrated effort to correct India's modal mix (%)
Air
Water
Rail
69
Road
57
Road
Road
47
<1
6
36
Air
Water
Rail
<1
5
25
Air
Water
Rail
<1
6
46
(KM's)
FY10
From current
Trajectory…
… to balanced
modal mix
Source: KPMG, McKinsey, IPA, MOSL
The Dedicated Freight
Corridor (DFC) is one of
the largest infrastructure
projects undertaken by
the Indian Railways since
independence
Dedicated Freight Corridor (DFC) project to transform CTO
The Dedicated Freight Corridor (DFC) is one of the largest infrastructure projects
undertaken by the Indian Railways since independence. Dedicated Freight Corridor
Corporation of India (DFCCIL), a special purpose vehicle (SPV) set up under the
administrative control of the Ministry of Railways, is constructing two corridors
spanning ~3,300km in the first phase – the Western DFC and the Eastern DFC. The
Eastern DFC, starting from Ludhiana in Punjab will pass through the states of Haryana,
Uttar Pradesh, Bihar, and terminate at Dankuni in West Bengal. The Western DFC will
traverse the distance from Dadri to Mumbai, passing through the states of Delhi,
Haryana, Rajasthan, Gujarat and Maharashtra.
Opening up of CTO industry in
2006 alone had led to
industry witnessing a 2.5x/
1.5x/ 1.6x volume growth in
the EXIM/ domestic/ total
segments, over FY08-10.
The Indian Railways’ quadrilateral linking the four metropolitan cities of Delhi,
Mumbai, Chennai and Kolkata, commonly known as the Golden Quadrilateral, and its
two diagonals (Delhi-Chennai and Mumbai-Howrah), adding up to a total route length
of 10,122km carries more than 55% of Indian Railways’ revenue-earning freight traffic.
The existing trunk routes of Howrah-Delhi on the Eastern Corridor and Mumbai-Delhi
on the Western Corridor are highly saturated, line capacity utilization varying between
115% and 150%. The surging power needs requiring heavy coal movement, booming
infrastructure construction and growing international trade has led to the conception
of the DFCs.
16
15 October 2012

Container Corporation of India
Objectives of DFC project
Reduce unit cost of transportation by
speeding up freight train operations
and higher productivity
Increase rail share in freight market by
providing customized logistic services
Segregate freight infrastructure for
focused approach on both passenger
and freight business of Railways
OBJECTIVES
Create additional rail infrastructure to
cater to high levels of transport demand
Introduction of high end technology and
IT packing of Freight Services
Introduction of time tabled freight
services and guaranteed transit time
Source: DFCCIL
DFCCIL envisages long haul operations, with trailing loads increasing from ~4,000 tons
to ~15,000 tons, carrying capacity increasing from 90 containers to 400 (by double
stacking), maximum speed from 75/kmph to 100/kmph and station spacing 7-10Km to
40Km. CTOs will be able to lower cost through increased efficiencies (higher asset
turnover and faster turnaround time) and become a reliable/preferred mode for longer
haul freight movement.
DFCs will increase efficiencies and lower cost for CTOs
Will increase asset
turnover and lower
turnaround time sharply
Source: DFCCIL
15 October 2012
17

Container Corporation of India
Update on DFC progress
We expect substantial part of the project awards to be completed in FY13/14. The
Western DFC is likely to be commissioned by FY16/17. We believe that the DFC project
will provide a ‘multiplier effect’ for India in many ways.
Phase-wise project details
Western Corridor
Phase I
Phase II
Phase III
Eastern Corridor
Phase I-APL1
Phase II-APL2
Phase III-APL3
Phase IV (Funding through PPP)
Phase Ia*
*Funding by Ministry of Railways
Year
Rewari- Vadodara (920 Kms)
Vadodara- JNPT(430Kms)
Rewari – Dadri(140 Kms)
Khurja - Kanpur (343 Kms)
Kanpur - Mughalsarai (390 Kms)
Khurja-Ludhiana (397 Kms)
Dankuni - Sonnagar (550 Kms)
Sonnagar - Mugal Sarai (125 Kms)
2009-2016
2010-2017
2010-2017
2009-2016
2010-2016
2011-2016
2011-2016
2010-2016
Source: Company, MOSL
Project cost and funding:
The total project cost is INR930b, including land cost of
INR70b. The net requirement for the DFC project is INR880b. Of this, INR100b of
Sonnagar-Dankuni (Eastern DFC) will be funded on PPP basis – IDC: INR60b; Bridges:
INR60b. Thus, DFCCIL requires funding of INR680b – debt of INR420b (JICA: INR280b
and WB: INR140b) and equity of INR260b.
Project awards to commence in FY13:
The final bids for project awards for the Western
DFC of 300-350km each are expected to be awarded by October 2012, while work is
expected to commence from 1QCY13. The signaling/electrical contract is likely to be
taken up for bidding by mid-FY14. For the Eastern DFC, bidding for 345km began in
2QFY13, with ~11 bidders being shortlisted.
Issues in terms of land
acquisition in Mumbai/
Thane and 10-12 villages
in Gujarat have also been
sorted out during 2QFY13
Land acquisition:
The Western DFC is being contemplated in three phases: Vadodara
to Rewari (920km), JNPT to Vadodara (430km), and Rewari to Dadri (140km). While
land acquisition for the Vadodara-Rewari section has been completed to the extent
of 83%, issues in terms of land acquisition in Mumbai/Thane and 10-12 villages in
Gujarat have also been sorted out during 2QFY13.
Western Dedicated Freight Corridor: Land acquisition status
Total Scope
kms Area (Ha)
274
1,064
359
958
196
907
75
558
27
122
930
3,608
202
460
118
239
108
612
141
942
569
2,252
1,499
5,860
20A
kms Area (Ha)
274
1,064
359
958
144
721
75
552
27
122
930
3,608
202
460
118
239
108
612
141
942
569
2252
1,499
5,860
kms
274
339
80
75
23
826
59
95
108
52
464
1,290
20E
Area (Ha)
1,064
924
459
412
82
3,205
77
148
446
307
1718
4,923
kms
274
339
78
73
-
776
-
4
108
-
143
919
20F
Area (Ha)
1,064
924
411
386
-
2,998
-
3
362
-
782
3,780
Progress Compensation (INR M)
(%)
Award
Disbursed
100.0
1,960
1,370
96.5
1,450
770
45.3
820
130
69.2
3,550
3,280
-
-
-
83.1
7,780
5,550
-
-
-
1.3
73
44
59.2
3,590
3,400
-
-
-
34.7
3,663
3,444
64.5
22,886
1,370
18
Jaipur
Ajmer
Ahmedabad
Vadodara
Dadri
Total Phase 1
Mumbai
Surat
Vadodara
Dadri
Total Phase 2
Grand Total
15 October 2012

Container Corporation of India
Key reforms that could revolutionize the logistics sector
The CTO industry could get a major fillip from few key reforms such as (1) the
implementation of GST, and (2) FDI in multi-brand retail. CCRI has strategically
positioned itself to capitalize on these opportunites once they become available.
As such, transport
requirement would shift
from shorter haul
‘warehouse to
warehouse’ to longer
haul ‘factory to factory’,
giving a boost to players
like CCRI
Implementation of GST:
The implementation of the Goods and Services Tax (GST)
could be a significant positive for the logistics industry, particularly for multimodal
players like CCRI. Currently, due to multiple and differential state-level taxes, most
companies are forced to set up multiple warehouses across the country, to minimize
inter-state movement and associated taxes. Implementation of the GST, which aims
at leveling these taxes, will obviate the need to have multiple warehouses.
Consequently, companies would be able to function effectively with fewer
strategically located warehouses across the country and adopt the hub and spoke
model to reduce inventory requirements and lower carrying cost. As such, transport
requirement would shift from shorter haul ‘warehouse to warehouse’ to longer haul
‘factory to factory’, giving a boost to players like CCRI that can effectively handle the
entire chain.
GST impact: Factory to factory transfer
Source: KPMG Analysis
FDI in multi-brand retail:
CCRI has been setting up cold chains to provide transportation
of perishable products from the source to the end user. Currently, only 10-15% of the
players in the cold storage business have such capabilities, primarily due to absence
of reefer container linkages and high power cost. CCRI has big plans to tap the
agriculture business opportunity through this route, for which it has constituted a
100% subsidiary, Fresh and Healthy Enterprises. Approval of FDI in retail is likely to
attract established MNC giants, who could potentially become captive customers for
CCRI.
15 October 2012
19

Container Corporation of India
Ongoing structural trends that portend well for CTOs
Ongoing structural trends towards increasing containerization and rail transport of
containers bode well for CTOs in general and CCRI in particular.
Structural move towards containerization
Currently, the share of container traffic in India is very low (~15% of total traffic) compared
to developed countries (~70% of traffic). Nonetheless, the share of container freight in
India has been steadily increasing over the years (10% in 2000 to ~15% in FY12). Container
traffic in India has grown at a CAGR of ~14.3% over FY02-12, compared to port traffic
growth of ~9.4%. Growth has been boosted by increasing contribution of non-major
ports from 28.4% in FY08 to 38% in FY12. Maritime Agenda 2020 estimates that container
trade in India would grow at a CAGR of 15% over FY10-20.
The need to aggregate
cargo, which is currently
moving piecemeal in bulk
form to ports for
containerization
The structural trend towards increased containerization in India is driven by:
The need to aggregate cargo, which is currently moving piecemeal in bulk form to
ports for containerization, aided by the development of new rail freight terminals/
ICDs/PFTs and logistics hubs, which would make it amenable to rail movement.
Economic development, leading to a shift in trade from raw materials to finished
goods, requiring containerization.
Removal of current infrastructure bottlenecks (ports in particular) and
development of other modes of transport (coastal shipping, etc).
Share of container trade steadily increasing
Growth of container freight
Source: IPA/MOSL
20
15 October 2012

Container Corporation of India
The share of
rail transport in overall
freight movement has
been declining steadily
from ~89% in FY51 to 53%
in FY87 to ~28% currently
Move towards ‘rail transport of containers’
The share of rail transport in overall freight movement has been declining steadily
from ~89% in FY51 to 53% in FY87 to ~28% currently. There has been little investment
in track infrastructure since independence. While route kilometers have grown at a
CAGR of just 3%, freight and passenger traffic has grown at a CAGR of ~52%. This has
led to most high density corridors becoming oversaturated, negatively impacting
CTO industry demand. Top seven key routes account for ~50% of the freight traffic in
India. Increasing share of non-major ports in container traffic and infrastructure
development around these ports should aid development of new routes and result
in lower pressure on existing high density traffic routes.
Key routes are congested, negatively impacting rail transport (%)
Top seven key routes
account for ~50% of the
freight traffic in India
Source: Industry, MOSL
The top-4 ports in India
currently account for
~87% of container
demand
CCRI key player across key EXIM markets
CCRI is the key player across key EXIM markets, with a lion’s share of the container
rail traffic across the four major ports of India. The top-4 ports in India currently
account for ~87% of container demand. JNPT alone accounts for 41% of the container
trade in India. New private ports such as Mundra and Pipavav are growing faster
than the major ports and have been steadily increasing their market share. CCRI has
been following the shift in trade and has steadily been increasing operations around
these new ports. Consequently, the share of volumes from JNPT has been steadily
declining for CCRI (~75% in FY08 to ~55% in 1QFY13).
Four ports account for bulk of container rail traffic
% container
handling as %
of total capacity
90
26
28
70
% of total
container
industry trade
42
22
11
12
87
% traffic
transported
by Rail
25-30
5
20-25
30-35
Total Rails
deployed
/Day
~20*
~2
~10
~9
Trains
deployed
by Concor
12
~2
5
4
Export/
Import Mix
50% /50%
49% /51%
54% / 46%
50% /50%
Source: Company, MOSL
JNPT
Chennai
Mundra
Pipavav
Total
*27 trains possible
15 October 2012
21

Container Corporation of India
Share of JNPT in overall container traffic*
Share of Indian Railways in container traffic
*Report of Working Group for Port Sector for the 12th five year plan, Ministry of Shipping
Source: IPA, IR, MOSL
CCRI's EXIM distribution port-wise
FY11
FY12
Source: Company
Changes in haulage charges by Indian Railways for key categories (INR/ TEU for 1,000Km)
Oct-10
Notified List
Cement Bricks and stones
Pig Iron and sponge iron
Iron and steel
POL
Fly Ash
Fire Bricks/ rods
Coal/ Bitumen
Kerosene oil
Others outside notified list
Sugar/ Oil cakes
Foodgrains
23,174
27,809
30,897
Dec-10
23,973
28,757
31,962
19,179
20,778
27,168
287
17,580
20,778
Mar-11
23,547
15,240
28,257
31,395
18,837
20,409
26,685
28,257
18,837
19,623
% Change
-1.8
-
-1.7
-1.8
-1.8
-1.8
-1.8
-
Apr-12
28,257
30,138
33,907
37,674
22,603
24,488
32,023
33,907
% Change
20.0
97.8
20.0
20.0
20.0
20.0
20.0
20.0
Trade re-alignment and
pressure on domestic rail
segment has resulted in
increasing empties cost
for CCRI, which stood at
INR1.8b in FY12,
empties cost in 1QFY13
stood at INR420m
7.2
15,240
-19.1
-5.6
15,240
-22.3
Source: Industry, Company, MOSL
15 October 2012
22

Container Corporation of India
Leveraging strategic JVs to provide total logistics services
Gaining an edge over standalone operators
CCRI's key strength is its ability to provide single window facility for multimodal logistics
services, by coordinating with various agencies and services involved in the containerized
cargo trade.
It is able to do so through its strategic JVs with its customers (GDL/Allcargo), port operators
(APM), road haulers (TCI), air cargo service providers (HALCON) and shipping lines (Maersk).
CCRI also has a fully-owned subsidiary engaged in cold chain management, through which
it aims to provide complete cold chain logistics solutions to organized retailers.
Strategic JVs across the CTO chain
CCRI has ~12 strategic JVs with leading MNCs like Maersk, DPI, APM, etc, and local
players like Gateway Rail, Allcargo, etc, across the value chain – from ports to terminals.
It leverages these JVs to provide total logistics services. The company could unlock
significant value from these ventures in the future.
CCRI has several strategic JVs with leading MNC and local players (INR m)
Particulars
Star Track Terminals
#Albatross Inland Ports
Gateway Terminals India
CMA-CGM Logistics Park*
Himalayan Terminals
Type
(%) Holding
49
49
26
49
40
50
15
49
49
49
49
50
Assets Liabilities
114
233
2,755
85
25
33
1,476
-
7
1
112
25
116
1,724
17
7
2
1,262
-
1
0
83
PBT
9
47
85
17
3
-1
-170
-
-2
-
-8
JV with Maersk India for CFS at Dadri, U.P.
JV with Transworld Group for CFS at Dadri, U.P.
JV with APM Terminals for third berth at JN Port, Mumbai
JV with Ameya Logistics for CFS at Dadri, UP
JV with Nepalese Ent & Transworld for management
and operation of rail CTO at Birgunj (Nepal)
HALCON
A arrangement with Hindustan Aeronautics for
operating air cargo complex & ICD at Ozar airport, Nasik
India Gateway Terminal
JV with Dubai Port Int. (DPI) for setting up and
managing Container Terminals at Cochin
Hind CONCOR Terminals*
JV with Hind Terminals for CFS at Dadri, U.P.
Infinite Logistics Solutions JV with TCI Ltd.to establish logistics freight terminals
and provide integrated logistics services
Container Gateway
JV with Gateway Rail for operations of existing rail/
road container terminal at Garhi Harsaru, Gurgaon
Allcargo Logistics Park
JV with Allcargo Global for setting up and running
CFS at Dadri
CONYK Cartrac
JV with NYK Auto Logistics for setting up &
dealing in CBU vehicle logistics
Total
*Dadri
18
1
-1
4,858
3,239
2,727
Source: Company, MOSL
Targeting the huge growth opportunity in cold chain industry
CCRI has a 100% subsidiary, Fresh and Healthy Enterprises (FHEL), which is engaged in
cold chain management. It aims to provide complete cold chain logistics solutions to
organized retailers. Its clients include Walmart, More, Big Bazzar, Mother Dairy, Big
Apple, etc. In FY12, FHEL procured 6,894m tons of apples, most of which were sold in
markets like Delhi, Chennai, Bangalore and Maharashtra. 80-90% of its off-season
sales were at fixed rates.
15 October 2012
23

Container Corporation of India
Almost 35% of the fruits
and vegetables produced
perish due to lack of cold
chain and distribution
infrastructure
Cold chain management in India offers huge growth opportunity. The fruit and
vegetable business in India is almost entirely in the unorganized sector and is worth
an estimated ~INR200b. Trade is carried on primarily on credit. Almost 35% of the
fruits and vegetables produced perish due to lack of cold chain and distribution
infrastructure. Farm sizes are small and farmers sell their produce at nearby markets/
mandis. Almost the entire chain is currently composed of unorganized players. The
introduction of GST will lead to increased requirement of total logistics solutions
such as 3PL/4PL, inventory /warehouse management, contract logistics services and
knowledge support services.
3PL at a nascent stage in India
The role of third-party logistics service (3PL) providers is at an early stage of evolution
in India. Unlike their global counterparts, Indian customers are yet to witness end-
to-end management of transport & logistics services by 3PLs. Growth of 3PLs will
increase demand for multimodal players like CCRI.
Penetration of 3PL in key countries
Source: KPMG, MOSL
15 October 2012
24

Container Corporation of India
Financials robust despite higher competition
Core RoCE at ~30%; to bottom out at ~22.7% in FY16
We expect CCRI’s revenue to grow at a CAGR of 11% and PAT to grow at a CAGR of ~8% over
FY12-15. Net margin should sustain at ~20%.
RoE is likely to remain subdued in the near term due to its high preemptive capex of
INR60b. We expect RoE to decline from 16.5% in FY12 to 14.9% in FY15.
We expect core RoCE, which is currently ~30%, to remain under pressure over the next ~4
years and bottom at ~22.7% in FY16.
Expect revenue CAGR of ~11% over FY12-15
We expect CCRI’s
revenue to grow at a
CAGR of 11% over FY12-15
from INR44.6b to
INR56.2b
We expect CCRI’s revenue to grow at a CAGR of 11% over FY12-15 from INR44.6b to
INR56.2b. This would be primarily led by the EXIM business and higher contribution
from other value-added segments. The revenue mix between EXIM and domestic is
likely to move from 82%:18% to 84%:16%.
Revenue and growth over FY12-15E
Source: Company, MOSL
EBIT margins to expand
We expect EBIT margins
in the EXIM business to
expand from 26.4% in
FY12 to 26.7% by FY15
Improvement in domestic segment, lower empties cost and operating efficiencies
result in EBIT margin expansion over FY12-15. We expect EBIT margins in the EXIM
business to expand from 26.4% in FY12 to 26.7% by FY15, while EBIT margins in the
domestic business are likely to expand from 8.4% in FY12 to 9.3% by FY15. Overall EBIT
margins are likely to expand from 21.2% in FY12 to 22.3% by FY15.
EBIT and EBIT margins over FY12-15E
Source: Company, MOSL
15 October 2012
25

Container Corporation of India
Expect PAT CAGR of ~8.3% over FY12-15
CCRI is undertaking
the capex to position
itself strategically for the
huge opportunity around
FY17-18
CCRI has historically maintained a net margin of ~20% due to its pricing power given
its dominant position in the industry. We do not see any major decline in CCRI’s
pricing power and expect this profitability to sustain. We model ~8.3% CAGR in net
profit over FY12-15. Given new investment would have a 2-3 year gestation period, in
the interim higher depreciation charge and lower other income would exert pressure
on the net profit growth. CCRI is undertaking the capex to position itself strategically
for the huge opportunity around FY17-18, when DFC gets completed. Industry experts
estimate that the completion of the DFC project would result in a jump of 1.7-2x in
CTO trade, with shortening of turnaround time, increased asset turnover due to double
stacking, and improved efficiencies.
Notwithstanding near-term pressure on net profit growth and RoCE due to the high
capex plans, we view this as a key positive, as the preemptive capex would (1) further
increase CCRI’s competitive advantage and allow it to capitalize on the large emerging
opportunity, and (2) correct CCRI’s capital structure by utilizing its surplus cash.
PAT growth to be subdued over FY12-15E (INR m)
Source: Company, MOSL
RoE to remain subdued in the near term due to high capex intensiy
CCRI’s RoE is
likely to remain subdued
in the near term due to
its high preemptive
capex of INR62b
CCRI’s RoE is likely to remain subdued in the near term due to its high preemptive
capex of INR62b. We expect RoE to decline from 16.5% in FY12 to 15.4% in FY15, and
asset turnover ratio to remain flat at 0.8x over FY12-15. The biggest gain for CCRI is
likely to be benefits with regard to asset turnover improvement. We expect CCRI’s
asset turnover to increase from 0.8x in FY12 to ~1.4x in FY18, while EBIT margins are
likely to improve from 21% in FY12 to ~24% by FY18, resulting in RoAE improving from
16.5% in FY12 to 20% in FY18.
RoE to remain under pressure in the near term
15 October 2012
26

Container Corporation of India
Core RoCE remains attractive
As at FY12, CCRI had
~INR27b cash (49% of
capital employed,
INR212/share)
As at FY12, CCRI had ~INR27b of cash (49% of capital employed, INR212/share), invested
primarily in fixed income securities, yielding low RoCE of ~9%. Consequently, CCRI’s
overall RoCE was just 16.2%. Its core RoCE, which has been under pressure post the
privatization of the CTO industry and has been steadily declining from 47% in FY08,
stood at 30.7% for FY12. We expect core RoCE to remain under pressure over the next
~4 years and bottom at ~23.7% in FY15, as the company is undertaking a major
preemptive capex of INR62b over FY13-17. DFC will enable CTO players to enjoy double
stacking of containers, while also reducing the turnaround time significantly. This will
allow companies to significantly increase their utilization rates, while also improving
their EBIT margins, implying sharp improvement in RoCE.
RoCE to bottom in FY16
Source: Company, MOSL
Preemptive capex of INR62b over FY13-17
CCRI is undertaking
preemptive capex of
~INR62b over FY13-17,
which is aimed at
increasing its
competitive advantage in
the CTO industry
CCRI is undertaking preemptive capex of ~INR62b over FY13-17, which is aimed at
increasing its competitive advantage in the CTO industry and establishing itself as a
total multimodal player. The break-up of the capex is as follows: ~INR20b for new
wagons, INR12b for land, INR5b for strategic JV's and INR20b for equipment and others.
For FY13 alone, it has capex plans of ~INR16.5b, which include ~INR7b in land for
setting up ~12 MMLPs, ~INR3.5b for wagons and ~INR5b for equipments. These
investment would open up several new business opportunities for CCRI in new areas,
which is currently not being captured in our estimates, due to lack of details.
Capex plans for FY13 and FY13-17 (INR b)
FY13
FY13-17
Source: Company, MOSL
15 October 2012
27

Container Corporation of India
Has steady and sustainable free cash flows
Over FY02-12, its OCF and
FCF have grown at a CAGR
of 12% and 17%,
respectively
CCRI is a debt-free company (net cash of INR27b as at March 2012) and enjoys steady
OCF and FCF. Over FY02-12, its OCF and FCF have grown at a CAGR of 12% and 17%,
respectively. This is against net profit CAGR of 13%, due to low reinvestment
requirements. It has historically maintained a dividend payout ratio of 25-30%. Despite
CCRI’s INR62b capex initiative over FY13-17, we expect it to maintain 24-25% payout
ratio during this period. Post the completion of its preemptive capex by FY16-17, we
expect CCRI to enter a sweet spot of sustainable and robust FCF, which should lead to
sharp improvement in its payout ratio.
OCF & FCF generation over FY06-FY15E
Dividend payout ratio has been stable between 25-30%, over FY06-FY15E
Post the completion of its
preemptive capex by
FY16-17, we expect CCRI
to enter a sweet spot of
sustainable and robust
FCF, which should lead to
sharp improvement in its
payout ratio
Source: Company, MOSL
15 October 2012
28

Container Corporation of India
Key Assumptions
FY08
EXIM
Volumes (m TEU)
% Change
Realization*
% Change
Value (INR b)
% Change
EBIT/ TEU
% Change
EBIT (INR b)
% Change
% of Sales
Domestic
Volumes (m TEU)
% Change
Realization*
% Change
Value (INR b)
% Change
EBIT/ TEU
% Change
EBIT (INR b)
% Change
% of Sales
Total
Volumes (m TEU)
% Change
Value (INR b)
% Change
Realization*
% Change
EBIT/ TEU
% Change
EBIT (INR b)
% Change
*Realization: INR/TEU
FY09
FY10
FY11
FY12
FY13E
FY14E
FY15E
CAGR
(FY12-15)
8.6
2.3
11.1
2.8
11.6
2.0
15.3
13,385
-6.1
26.5
8.2
3,694
-12.7
7.3
0.6
27.6
0.5
20.7
14,895
-2.0
7.0
18.3
2,032
-22.1
1.0
-6.0
13.6
2.4
16.3
33
10.2
13,675
-5.2
3,147
-16.9
7.7
-3.4
1.9
-6.2
14,693
9.8
27.3
3.0
4,360
18.0
8.1
10.7
29.7
0.5
-3.6
15,176
1.9
6.9
-1.8
2,104
3.5
1.0
-0.2
13.9
2.3
-5.7
34
2.0
14,788
8.1
3,498
11.2
8.1
4.8
1.9
1.5
15,399
4.8
29.0
6.3
4,017
-7.9
7.6
-6.5
26.1
0.5
18.9
14,977
-1.3
8.1
17.3
2,413
14.6
1.3
36.3
16.1
2.4
4.9
37
8.6
15,305
3.5
3,390
-3.1
8.2
1.7
2.0
7.2
14,820
-3.8
29.9
3.2
4,103
2.1
8.3
9.5
27.7
0.5
0.9
15,387
2.7
8.4
3.7
1,474
-38.9
0.8
-38.4
9.6
2.6
5.8
38
3.3
14,940
-2.4
3,383
-0.2
8.7
5.6
2.1
5.8
15,293
3.2
32.7
9.2
4,040
-1.5
8.6
4.2
26.4
0.5
-13.9
16,983
10.4
8.0
-4.9
1,420
-3.7
0.7
-17.1
8.4
2.6
1.6
41
6.1
15,597
4.4
3,307
-2.2
8.6
-0.6
2.3
6.5
15,645
2.3
35.6
8.9
4,068
0.7
9.3
7.2
26.0
0.5
10.0
17,238
1.5
8.9
11.7
1,465
3.2
0.8
13.5
8.5
2.8
7.1
44
9.5
15,939
2.2
3,367
1.8
9.4
9.1
2.5
9.5
16,005
2.3
39.9
12.0
4,257
4.7
10.6
14.6
26.6
0.6
11.2
17,583
2.0
10.1
13.4
1,618
10.4
0.9
22.8
9.2
3.1
9.8
50
12.3
16,300
2.3
3,583
6.4
11.0
16.9
2.7
9.8
16,357
2.2
44.7
12.2
4,384
3.0
12.0
13.1
26.8
0.6
12.0
17,899
1.8
11.5
14.0
1,665
2.9
1.1
15.3
9.3
11.1
1.8
13.0
5.5
17.1
3.4
9.0
10.2
56
11.4
12.6
16,650
2.2
2.1
3,720
4.0
3.8
12.6
13.4
14.4
Source: Company, MOSL
EXIM volumes (in m TEU and INR b)
Domestic volumes (in m TEU and INR b)
Source: Company, MOSL
15 October 2012
29

Container Corporation of India
EXIM Volumes (CAGR, %)
Historical
FY09-12
FY08-12
FY04-12
FY13-15
FY13-18
FY13-20
4.8
3.7
6.9
Estimates
8.6
13.3
15.5
EXIM Volumes over FY03-15
EXIM Value (CAGR, %)
Historical
FY09-12
FY08-12
FY04-12
FY13-15
FY13-18
FY13-20
6.2
3.6
12.2
Estimates
11.1
15.0
17.0
EXIM Value over FY03-15
Domestic Volumes (CAGR, %)
Historical
FY09-12
FY08-12
FY04-12
FY13-15
FY13-18
FY13-20
1.1
3.1
3.7
Estimates
11.1
13.7
14.8
Domestic Volumes over FY03-15
Domestic Value (CAGR, %)
Historical
FY09-12
FY08-12
FY04-12
FY13-15
FY13-18
FY13-20
5.0
5.0
7.1
Estimates
13.0
15.1
16.0
Domestic Value over FY03-15
Source: Company, MOSL
15 October 2012
30

Container Corporation of India
Estimating long-term demand for containerized rail transport
If some of the expected triggers play out, the CTO industry could witness a volume
CAGR of 17.6% over FY12-18. Being the dominant player in the industry, CCRI should
be in a position to capture a significant proportion of this opportunity. We expect
the share of rail transport in overall container freight movement to increase from
21% in FY12 to 25% in FY18.
Key assumptions
1. Container port freight traffic:
We have used the estimates of the Maritime Agenda
2020 and the Planning Commission of India.
2. Share of rail in overall container port traffic:
The Indian Railway Vision 2020
estimates container haulage at ~200mt for FY20.
3. Realizations:
We expect realizations to grow at a CAGR of 1.5% for both EXIM and
domestic segments over FY12-17. Realizations are likely to be under pressure,
given lower pricing in case of double-stacking and declining lead distances.
4. EBIT margins:
We expect EBIT margins to expand at a CAGR of 2.5% in the EXIM
business and 3% in the domestic business, on the back of increased efficiencies.
Workings for estimating CTO demand and Concor share by FY17/18
Container Road Traffic
1. EXIM
Total Port Freight in FY12 (MT)
Total Container Traffic (MT)
Total Container + Other Traffic (MT)
Container Freight by all Ports (MT)
% Share
% of Container + Other traffic
Industry CTO volumes (MT)
Share of Railways (%)
Concor Market Share- Volumes (%)
Realizations (INR/ TEU)
TEU's ('000)
Value (INR m)
Multiple (x)
2. DOMESTIC
Industry CTO Volumes (MT)
Concor Market Share (%)
Realizations (INR/ TEU)
Volumes TEU's (m TEU)
Value (INR m)
Multiple (x)
TOTAL (1+2)
Industry CTO Volume (MT)
3. CONCOR
Total Volumes (MT)
Total Value (INR m)
Multiple (x)
% Market Share Share
Share of EXIM - Value-wise
Share of EXIM - Volume-wise
FY12
Base Case
FY17-18
CAGR
(6 Yrs %)
1,758
325
566
325
18
57
81.3
25
74
16,722
5.8
96
3.0
20.9
69
18,570
1.02
18.9
2.4
102.1
74.2
115.4
2.8
72.7
83.6
80.7
10.4
14.8
13.3
14.8
4.0
1.4
18.6
3.3
-0.5
1.5
18.0
19.8
Bear Case
FY20
CAGR
(8 Yrs %)
2,238
388
738
388
17.3
52.6
96.9
25
72
16,560
6.8
111
3.5
26.5
66.6
18,391
1.3
23.1
2.9
123.4
87.4
134.3
3.3
70.8
82.9
79.9
11.0
13.4
13.5
13.4
2.2
-0.1
16.2
2.5
-0.7
1.0
15.6
16.6
Opening up of CTO industry in
2006 alone had led to industry
witnessing a 2.5x/ 1.5x/ 1.6x
volume growth in the EXIM/
domestic/ total segments,
over FY08-10.
IR share of container
traffic to increase from
21% in FY12 to
25% by FY18
971
142
268
142
15
53
29.2
21
76
15,293
2.1
33
9.4
70
16,983
0.47
8.0
14.2
-0.3
1.5
13.9
15.6
13.8
-0.6
1.0
13.2
14.2
38.6
28.8
40.6
74.5
80.4
77.1
17.6
17.1
19.0
15.6
14.9
16.1
-0.6
0.4
0.4
31
CCRI's total volumes to
increase at CAGR of
17.1% over FY12-18
15 October 2012

Container Corporation of India
Workings for estimating CTO demand and Concor share by FY17/18 (Cont. from earlier page)
Container Road Traffic
EBIT/ TEU
EXIM (INR/ TEU)
Domestic (INR/ TEU)
Concor - Volumes (TEU's)
EXIM
Domestic
Total
Multiple (x)
Concor - EBIT (INR b)
EXIM
Domestic
Total
Multiple (x)
Tax
Operational PAT (INR b)
Multiple (x)
FY12
Base Case
FY17-18
CAGR
(6 Yrs %)
4,686
1,695
5.8
1.0
6.8
2.6
27.0
1.7
28.7
3.1
8.6
20.1
2.8
2.5
3.0
18.0
13.9
17.3
Bear Case
FY20
CAGR
(8 Yrs %)
4,375
1,798
5.6
1.4
7.0
2.7
1.0
3.0
12.8
14.8
13.1
4,040
1,420
2.1
0.5
2.6
8.6
0.7
9.3
2.0
7.3
21.0
17.3
20.7
27.6
18.4
Expect operating PAT to
increase by 2.8x over
FY12-18
24.4
13.9
2.5
18.2
26.9
14.2
2.9
9.2
20.9
17.8
11.8
2.4
Source: Company, MOSL
Port-wise Container Traffic Assumptions (FY12-18)
FY12
FY13E
FY14E
FY15E
FY16E
FY17E
FY18E
% CAGR
(FY12-18)
9.9
1.0
1.4
25.7
10.3
21.8
10.4
28.1
13.7
9.9
1.0
1.4
25.7
10.3
21.8
10.4
28.1
13.7
Source: MOSL
Major Ports (m tons)
Kolkata
7
8
8
9
10
12
Chennai
30
27
27
30
32
32
Tuticorin
9
7
7
9
9
10
Cochin
5
12
15
17
18
19
JNPT
58
58
76
92
105
105
Other Major Ports*
14
14
17
33
45
45
Total Major Ports
123
125
150
189
219
223
Non Major Ports
19
31
46
67
76
84
Total Major and Non-Major Ports
142
156
197
256
295
307
Major Ports (%)
Kolkata
4.8
5.0
4.2
3.4
3.2
3.9
Chennai
21.2
17.1
13.6
11.7
10.9
10.4
Tuticorin
6.5
4.2
3.6
3.3
3.1
3.3
Cochin
3.3
7.4
7.6
6.6
6.0
6.0
JNPT
41.1
37.3
38.8
35.8
35.7
34.3
Other Major Ports*
9.7
9.0
8.6
12.8
15.3
14.7
Total Major Ports
86.6
80.0
76.4
73.7
74.2
72.6
Non Major Ports
13.4
20.0
23.6
26.3
25.8
27.4
Total Major and Non-Major Ports
100.0
100.0
100.0
100.0
100.0
100.0
* Includes Haldia, Paradip, Visakapatpam, Ennore, New Mangalore, Morgumao, Kandla and Port Blair
12
37
10
19
109
49
236
89
325
3.7
11.4
3.1
5.8
33.5
15.1
72.6
27.4
100.0
15 October 2012
32

Container Corporation of India
Lead distance under pressure in EXIM (kms)
Lead distance has been
under pressure in the
Exim segment, while it
has increased in the
domestic segment
Source: Indian Railways
Distance Between North India ICDs and Ports (kms)
Increasing share of
Mundra and Pipavav
leading to shorter lead
distance for EXIM
segment
Nhava Sheva
(Kms)
TKD
Loni
Dadri
Ludhiana
1,513
1,380
1,460
1,895
Mundra
(Kms)
1,276
1,183
1,228
1,551
Pipavav
(Kms)
1,333
1,325
1,280
1,590
Closer to
Mundra by
(Kms)
237
197
232
344
Closer to
Pipavav by
(Kms)
180
55
180
305
Source: Industry
Maritime Agenda 2010-20 growth assumptions (%)
Cargo Volumes
Coal
POL
Iron-ore
Containers
Others
Total
CAGR (FY10-17)
CAGR (FY10-20)
23.0
18.0
7.0
7.0
6.0
6.0
19.0
15.0
15.0
13.0
13.0
11.0
Source: Maritime Agenda 2010-20
Summary of Projected Freight Loading by IR by 2020 (M tons)
2011
Coal
RM for steel plants
Pig Iron & Finished Steel
Cement
Iron Ore (Exports)
Iron Ore (Imports)
Food grains
Ferilizers
POL
Containers
Others
Total
2020 Increase
CAGR
(x) (FY11-20)
420
700
1.7
5.8
13
39
2.9
12.7
33
108
3.3
14.2
99
250
2.5
10.8
26
75
2.9
12.6
93
150
1.6
5.5
43
50
1.2
1.6
48
70
1.5
4.2
39
48
1.2
2.2
38
210
5.6
21.1
69
150
2.2
9.0
922
1,850
2.0
8.0
Source: Indian Railway Vision 2020
15 October 2012
33

Container Corporation of India
Initiating coverage with Buy
Target price of INR1,250 implies 19% upside
While concerns such as high empties cost and muted near term growth outlook in particular
remain, the long-term prospects are favorable for CCRI and outweigh near term concerns.
We value CCRI using DCF methodology. While our DCF value is INR1,250 (19% upside).
Given CCRI’s strong FCF generation capability, high operating RoCE and stable payout ratio,
the best way to value it is through DCF.
DCF based target price of INR1,250
We believe DCF is the best way to capture the intrinsic value of CCRI, given its stable
cash flow, consistent payout ratio, robust ROCE and low re-investment requirements.
CCRI's inimitable pan India network provides it with significant entry barriers, which
coupled with positive industry growth outlook, will allow it to enjoy a prolonged
period of growth. We model CCRI to register a revenue CAGR of 11.5% over FY13-32,
driven a high growth period between FY13-20, post which we have assumed its growth
rate to move from 9.3% in FY21 towards its terminal growth assumption of 5.4%. Our
terminal growth rate assumption is based on RoCE spread of 2.5% over its terminal
period cost of capital at 12.9%. Using the DCF methodology, we arrive at a value of
INR1,250.
Key assumptions
Valuation Inputs
Growth Period
Risk free Rate (Rf)
Levered Raw Beta (B)
Market Risk Premium (Rmp)
Cost of Equity: Rf+B(Rmp)
Stable Period
Risk free Rate (Rf)
Levered Raw Beta (B)
Market Risk Premium (Rmp)
Cost of Equity: Rf+B(Rmp)
India country Default Spread
Adjusted Risk free Rate (Rf)
Terminal Growth rate (Tg)
(%)
8.0
0.40
7.5
11.0
8.0
0.65
7.5
12.9
2.0
6.0
5.4
Comments
RBI 10 year G-sec Bond Yield 5/10/2012
Bloomberg 1 year average Raw Regression Beta
Implied India Risk Premium based on Sensex
CAPM
RBI 10 year G-sec Bond Yield
Assuming long term Beta will trend towards 1x
Implied India Risk Premium based on Sensex
CAPM
Based on S&P Bond Default spread of 2% based
on India’s BBB+ rating
Real Risk free rate in India
ROCE spread of 2.5% over terminal cost of capital
Source: MOSL
15 October 2012
34

Container Corporation of India
15 October 2012
Terminal Gr. (%)
Terminal Gr. (%)
35

Container Corporation of India
Comparative Valuations
Company Name
Mkt Cap
CMP (USD b)
2.6
0.3
0.3
0.1
2.8
1.3
57.3
15.2
22.0
BV (INR)
FY13 FY14
480.0
90.3
131.6
167.8
3.7
3.7
46.6
34.4
9.9
536.1
97.9
146.8
200.7
3.7
4.3
51.9
39.6
11.1
EPS Gr. (%)
FY13 FY14
8.7
13.0
-6.0
29.8
10.9
24.3
14.9
29.2
12.2
6.3
16.7
15.7
48.1
24.9
18.3
14.0
21.5
12.6
P/E (x)
FY13 FY14
14.5
10.3
7.5
5.2
12.6
11.6
12.7
15.7
10.6
13.6
8.9
6.4
3.5
10.1
9.8
11.1
12.9
9.4
P/BV (x)
EV/ EBITDA (x)
RoE (%)
FY13 FY14 FY13 FY14 FY13 FY14
2.2
1.6
1.0
0.8
0.7
1.7
2.6
2.5
2.1
2.0
9.6
8.3
16.0
1.5
6.6
5.7
15.6
0.9
5.3
4.7
14.1
0.7
7.4
5.4
14.6
0.7
4.2
3.5
5.8
1.5
6.8
5.5
14.7
2.3
7.0
6.3
20.8
2.2
9.2
8.1
16.4
1.9
6.2
5.7
22.2
Source: Bloomberg, Company,
15.1
16.7
14.5
18.4
6.8
15.7
23.2
18.7
20.5
MOSL
Concor
1,048
Gateway Distripark
142
Allcargo
130
Arshiya International
134
Guangshen Railway
3
China Railway Tielong
6
Union Pacific Corp
121
Canadian Pacific Railway 86
CSX Corp.
21
Prices as on 11 October 2012
PE below historical average of 15.3x
P/B below historical average of 2.6x
EV/ Sales below historical average of 3.1x
EV/ EBITDA below historical average of 10.5x
15 October 2012
36

Container Corporation of India
Risks and concerns
Execution risk / possible delays in DFC implementation:
Successful execution of the
DFC project has the potential to increase container rail traffic by 1.7-2x. Given its
critical nature and the possible upside from its implementation, the project has been
able to garner considerable support from both the central and state governments.
Nonetheless, the project faces considerable challenges in the form of pending land
acquisitions, funding requirements and execution risks. Any delays in project
execution would mean delayed upsides and lower our estimated valuations for CCRI.
Forays into new segments:
CCRI is foraying into new segments such as warehousing,
air cargo, ports, and cold chain management. While this would transform CCRI into a
total logistics player, it would also present significant execution challenges.
Unfavorable EXIM trade mix leading to high empties cost:
Due to the mismatch
between exports and imports in trade, particularly at some of the new ports and in
domestic operations, the empties cost of CCRI has been steadily increasing.
Unbalanced trade at key ports could further increase empties cost, which stood at
INR1.2b in FY12 and INR423m in 1QFY13.
Risks related with economic slowdown:
Bulk of the container rail transport in India is
for EXIM trade, which is highly correlated with GDP growth. Any slowdown in economic
growth would have a negative impact on EXIM trade, and in turn on the growth outlook
for CTOs like CCRI.
Overdependence on single rail corridor:
Another key risk holding back growth of CTO
players is single rail corridor at key ports like Mundra and Pipavav, due to which
turnaround time increases and rail traffic gets negatively impacted. Rail transport of
the overall container traffic is low at 20-30%.
Challenges with regard to JNPT expansion plans:
With regard to JNPT expansion for
terminal-4, the erstwhile bidders withdrew in August 2012. The port authorities are
in the process of inviting fresh bids, which could delay the planned capacity additions.
Tariff Authority for Major Ports (TAMP) related issues:
In February 2012, TAMP ordered
Nhava Sheva International Container Terminal (NSICT) and Gateway Terminal (GTICT)
to lower tariffs by 27.85% and 44.28%, respectively. The tariff cut was largely because
these ports were operating at 117%/135% capacity utilization (based on the minimum
guaranteed throughput). This tantamounts to punishing efficiency, as the revenue
share (paid to JNPT) is not allowed as cost while fixing the tariff. Hence, the operators
will attempt to lower their throughput to just the minimum guaranteed.
15 October 2012
37

Container Corporation of India
Company background
Container Corporation of India
(CONCOR; Bloomberg Code: CCRI)
is a state-owned
company incorporated in March 1988. It was set up with the intent to develop
multimodal transport and logistics support for domestic and international
containerized cargo. Post the commencement of its operations, Indian Railways’
container freight service is being handled by CONCOR through yearly MoUs.
Revenue break-up (FY12)
EBIT break-up (FY12)
Source: MOSL, Company
Organizational structure
Managing Director
Director (International
Marketing & Operation
(Exim, Operation,
Commercial, Marketing
Air Cargo)
Director (P&S)
Director (Finance)
Director (Domestic)
Projects, Engineering
Technical & MIS
(Finance, Accounts,
Secretarial & Internal
Audit)
HRD
(Domestic Operation,
Common Marketing)
Region-wise break-up
Top terminal contributors (% of total)
Source: MOSL, Company
15 October 2012
38

Container Corporation of India
CCRI's Pan-India terminal network
Source: Company
39
15 October 2012

Container Corporation of India
Financials and Valuation
Income Statement
Y/E March
Net Sales
Change (%)
EBITDA
Margin (%)
Depreciation
EBIT
Int. and Finance Charges
Other Income - Rec.
PBT after EO Exp.
Current Tax
Deferred Tax
Tax Rate (%)
Reported PAT
Change (%)
Margin (%)
2011
38,992
4.5
10,156
26.0
1,489
8,667
49
1,971
10,588
1,647
179
17.2
8,763
12.7
22.5
2012
41,009
5.2
10,234
25.0
1,621
8,613
54
3,135
11,693
2,885
152
26.0
8,656
-1.2
21.1
2013E
44,469
8.4
11,331
25.5
1,867
9,464
29
2,992
12,426
2,808
211
24.3
9,406
8.7
21.2
2014E
49,939
12.3
13,029
26.1
2,222
10,807
32
2,457
13,232
3,003
226
24.4
10,004
6.3
20.0
(INR Million)
2015E
56,220
12.6
14,752
26.2
2,552
12,200
34
2,543
14,709
3,447
259
25.2
11,002
10.0
19.6
Balance Sheet
Y/E March
Equity Share Capital
Total Reserves
Net Worth
Deferred Liabilities
Other Liabilities
Total Loans
Capital Employed
2011
1,300
48,088
49,388
2,288
695
296
52,667
2012
1,300
54,252
55,552
2,438
449
234
58,673
35,856
11,268
24,588
1,151
2,447
3,903
32,989
360
303
27,616
4,710
6,406
4,865
1,540
26,583
58,673
2013E
1,300
61,095
62,395
2,438
494
254
65,581
49,356
13,135
36,221
1,151
2,447
4,002
28,289
396
311
22,246
5,336
6,530
5,020
1,510
21,759
65,581
(INR Million)
2014E
1,300
68,385
69,685
2,438
543
274
72,940
58,556
15,356
43,200
1,151
2,447
3,995
29,204
442
350
22,420
5,993
7,057
5,443
1,614
22,147
72,940
2015E
1,300
76,523
77,822
2,438
598
294
81,152
67,756
17,908
49,848
1,151
2,447
4,217
31,452
496
394
23,816
6,746
7,963
6,110
1,853
23,489
81,152
Gross Block
33,683
Less: Accum. Deprn.
9,722
Net Fixed Assets
23,961
Capital WIP
1,069
Total Investments
1,956
Other Assets
2,475
Curr. Assets, Loans&Adv.
28,230
Inventory
125
Account Receivables
296
Cash and Bank Balance
22,961
Loans and Advances
4,848
Curr. Liability & Prov.
5,023
Current Liabilities
3,662
Provisions
1,361
Net Current Assets
23,207
Appl. of Funds
52,667
E: MOSL Estimates; * Adjusted for treasury stocks
15 October 2012
40

Container Corporation of India
Financials and Valuation
Ratios
Y/E March
Basic (INR) *
Consol EPS
Cash EPS
BV/Share
DPS
Payout (%)
Valuation (x) *
P/E
Cash P/E
P/BV
EV/Sales
EV/EBITDA
Dividend Yield (%)
FCF per share
Return Ratios (%)
RoE
RoCE
Working Capital Ratios
Asset Turnover (x)
Inventory (Days)
Debtor (Days)
Creditor (Days)
Leverage Ratio (x)
Current Ratio
Interest Cover Ratio
2011
67.4
78.9
380.0
18.0
26.8
2012
66.6
79.1
427.4
19.2
28.8
2013E
72.4
86.7
480.0
19.7
27.2
2014E
77.0
94.1
536.1
20.9
27.1
2015E
84.6
104.3
598.7
22.0
26.0
14.0
11.8
2.2
2.7
10.6
2.1
58.5
12.9
10.8
1.9
2.6
10.1
2.1
-21.5
12.1
9.9
1.7
2.3
8.8
2.2
22.3
11.0
9.0
1.6
2.0
7.6
2.4
32.9
19.0
22.9
16.5
22.3
16.0
21.0
15.1
20.0
14.9
19.9
0.7
1.7
2.7
49.4
0.7
4.6
2.7
62.2
0.7
4.7
2.5
59.4
0.7
4.7
2.5
57.6
0.7
4.7
2.5
57.6
5.6
177
5.1
160
4.3
323
4.1
341
3.9
358
Cash Flow Statement
Y/E March
EBIT
Depreciation
Direct Taxes Paid
(Inc)/Dec in WC
CF from Operations
(inc)/dec in FA
(Pur)/Sale of Investments
Investment Income
CF from investments
(Inc)/Dec in Debt
Interest Paid
Dividend Paid
(Inc)/Dec in Deff Tax Liab
CF from Fin. Activity
Inc/Dec of Cash
Add: Beginning Bal
Closing Balance
2011
8,667
1,489
1,825
-2,793
5,537
-2,095
-34
1,971
-159
-128
49
2,345
179
-2,344
3,035
19,925
22,960
2012
8,613
1,621
3,037
-395
6,801
-2,331
-491
3,135
312
-62
54
2,493
150
-2,459
4,655
22,961
27,616
2013E
9,464
1,867
3,020
-601
7,710
-13,500
0
2,992
-10,508
20
29
2,563
0
-2,572
-5,370
27,616
22,246
(INR Million)
2014E
10,807
2,222
3,229
-158
9,643
-9,200
0
2,457
-6,743
20
32
2,714
0
-2,726
174
22,246
22,420
2015E
12,200
2,552
3,707
-113
10,932
-9,200
0
2,543
-6,657
20
34
2,865
0
-2,879
1,396
22,420
23,816
41
15 October 2012

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Container Corporation of India
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