Container Leasing - Catalyst to Growth Presented by: Captain Somesh Batra Chairman Marine Container Services (India) Pvt. Ltd. 1

Introduction Core Operating Areas What WE do Ship Agency Container Repairs & Storage Depot Management Port Representation Total Freight Solutions & Distribution Systems Chartering & COAs, Offshore Ship Manning & Management Port Captaincy & Cargo Supervision NVOCC & Multimodal Transportation Container Leasing

World Maritime Container Shipping Snapshot Total number of container ships: 5,950+ Container capacity of these ships: 18 MN TEUs+ Order book: 483 Ships Container capacity of these ships: 3.6 MN TEUs+ Growth in % 2013 2014 (p) GDP 3.2 3.4 Trade Volume 2.92 4.94 Container Shipping Volume 4.77 6.12 Source: Dynamar, IMF, Clarkson

Asia China Europe India America World Maritime WORLD 641 MN Global Container Throughput 2013 WORLD 641 MN America Europe Asia China India Global Container port demand 800 MN TEUs per annum by 2017 Global Container market demand to grow @ 6 % per annum in 2014-2016

Kandla, Mundra, Pipavav, Hazira New Mangalore, Kochi, Mormugao, India Maritime Projected container handling capacity-2020 Total 33 MN TEUs 6.0 Upper West Coast Upper East Coast 3.0 Kandla, Mundra, Pipavav, Hazira 12.3 1.2 Paradip, Haldia, Kolkata, Dhamra, Kulpi Central West Coast Mumbai, JNPT, Dighi & Jaigardh 6.5 4.0 2012-13 N. Sheva 4.60 Mundra 2.40 Chennai 1.40 Pipavav 0.70 Kolkata 0.60 Others 2.07 Total 11.77 Central East Coast Vizag, Gangavaram, and Krishnapatnam Lower West Coast Lower East Coast New Mangalore, Kochi, Mormugao, Vizhinjam Chennai, Ennore, Tuticorin

India The Growth Drivers FDI - PPP International & Regional Trade Coastal Shipping - Domestic Inland Waterways Exports & Manufacturing Logistics Parks Dedicated Freight Corridors Efficient Food Supply Chain New Ports & Container Terminals The Growth Drivers

Container Leasing

Container Leasing A Necessity 50% of the world container fleet is owned or managed by Lessors Lessors infuse Capital: Allowing lessees use their resources for core activity i.e.: Purchase of assets like Ships, Wagons, Trucks, Terminal, CFS, Infrastructure requirements Etc. Provides logistics & operational flexibility to Lessees Lessors assist during seasonal peaks( & troughs) , unplanned moves, additional surge in business & unforeseen Logistics bottlenecks like congestion Ensure High International Technical, Safety & Maintenance Standards with well trained M&R professionals in Depots Worldwide

Container Leasing Classifications of Leases 2 - Major Classification (1) Finance Like a hire purchase scheme wherein containers can be ordered to Lessee specifications & ownership transferred to Lessee at the end of a 3 to 10 year term (2) Operation Long Term Lease Master Lease Minimum Days Lease Short Term Lease Round Trip One Ways Leases can be tailor-made to Lessee’s requirements

Container Leasing Global Container Fleet & Lessors’ Share (MN TEUs) Source: Dynamar & World Cargo News

Container Leasing Top 10 International Lessors – Inventory in ‘000 TEUs BOX LESSOR 2011 2012 2013 1 TEXTAINER 2,470 2,775 3,040 2 TRITON 1,855 2,060 2,200 3 TAL 1,625 1,935 2,050 4 FLORENS 1,775 1,900 5 SEA CUBE 930 1,225 1,300 6 SEACO 990 1,095 1,190 7 CAI 1,060 1,150 8 CRONOS 725 810 880 9 DONG FANG 495 485 555 10 TOUX 505 520 500 OTHERS 1,650 1,830 1,985 Lessor Total 13,950 15,650 16,750 Source: Dynamar & World Cargo News

Container Leasing Lessor Lessee Aspirations of Lessor & Lessee Invests finance & capital to build High Quality Container Assets Anticipate demand & ensure supply - continuous investment Continuous investments in maintenance & repairs Maintain younger fleet Exercises stringent due diligence prior credit approval & lease of containers to Lessees ‘Time is of essence’ not only for payments but for repair approvals, pick ups, redeliveries etc.. Lessee Expects quality containers for safe carriage & storage Prompt supply & redelivery Optimum per diem & costs Promptness in responses Excellent Service Quality

Container Leasing India - International Lease Leases for Exim business or International boxes are for exclusive use in international waters The lease rentals are payable in US Dollars Shipping Lines, Logistic Companies & NVOCCs are active

Container Leasing

Container Leasing

Container Leasing

Container Leasing India - Domestic Lease or Domesticated Boxes Customs Act: Containers used for domestic transportation must be Customs Duty paid “Bonded”, “in-transit” containers for use in the Domestic Tariff Area is prohibited by Law Such usage could entail penal actions & payment of duties if discovered and is avoidable

Container Leasing COA IMO ISO WCO BIC CSC IICL International Safety & Standards to be enforced fully IICL The Institute of International Container Lessors COA Container Owners Association IMO International Maritime Organization ISO International Organization for Standardization WCO World Customs Organization BIC Bureau International des Containers et du Transport Intermodal CSC Convention on Safety of Containers

Container Leasing International Safety & Standards to be enforced fully Implementation of International Conventions – CSC, & amendments thereto ( ACEP) Ensuring only plated containers are used in intermodal supply chains to preserve safety of life & property Ensuring Over The Road (OTR) restrictions & axle-limits are enforced Enforcing Central Motor Vehicles Rule (CMVR) overall dimension limits on roadways

Container Leasing International Safety & Standards to be enforced fully

Container Leasing Challenge - Grey market ? ? Be Warned…

Multiple Usages 22 22

Container Leasing.. Dry Vans Flat Racks Open Top Reefers

Container Leasing Specials: Open Tops & Flat Racks Over Dimensional Cargoes like Engineering Goods, Project Cargoes, Machinery, Glass Sheets etc. are carried in Specials Defence Sector, Logistics players & Manufacturers can operate DOMESTICATED Special Containers for storage & transport…

Container Leasing Reefers: Food Supply Chain

Container Leasing Tanks: for Liquids Liquid Cargoes like Chemicals, Oil, Alcohol, Wine, Gas etc.. can be carried in Tank Containers Chemical Manufacturers, Liquid Cargo Operators, Logistics Carriers DOMESTICATED Tank Containers available for storage & transport while scarce capital can be used for other operational requirements

Container Leasing Project accommodation offsite (factories, highways, SEZs)

Container Leasing Accommodation/storage in CRZ, Hill areas & Ports/Airports

Container Leasing Accommodation/storage in CRZ, Hill areas & Ports/Airports

Container Leasing Storage & distribution of food-grains

Container Leasing Accommodation units

Container Leasing Accommodation units

Container Leasing Food Stalls

Container Leasing Food Stalls

Container Leasing Food Stalls

Container Leasing Reefer Storage

Container Leasing Small Data Centers

Container Leasing Moving Barges

Container Leasing Counters

Container Leasing Lunch Room

Container Leasing Remote hospitals

Container Leasing Bus Stops

Container Leasing Mobile Washrooms – Swach Bharat

Container Leasing SCOPE & Potential for Domestic Movements Coastal & Inland Waterways New routes Rail Existing plus DMRC, Double Stack Trains Road New expressways & highways Static Storage Raw Materials, Finished Products CFS Transfer from Liner boxes into Domestic Food Supply Storage & Transport including cold & perishables in Reefer Defence Sector Carriage, Transport, Site Offices, Camps, Rapid Transport, Strategic Storage Portable office Portable Training Centre Rooms/Shelters Lunch Room / Electrical Room / Rest Room Small Data Centre ATMs & Banks in remote areas Storage Rooms Warehousing

… And many more Opportunities!

Container Leasing - Catalyst to Growth In a Nutshell Containers can be used for a variety of purposes not just storage and transport Example: Grain harvested directly into containers could be stored up to ‘5’ years, if the original moisture content is 12% or less. The containers prevent entry of moisture and insects and therefore the grain leaves the container in the same condition in which it was originally. * Container Leasing stimulates growth and adds value Shift of 5% cargo movement from road to coastal will save 1,300 crore rupees in fuel subsidy The scope is as vast as one can imagine and implement! Source: www.ams.usda.gov

THANK YOU Captain Somesh Batra someshbatra@seahorsegroup.co.in someshbatra@yml.in 47