Adani forays into freight forwarding business

Gautam Adani-led Adani Ports and Special Economic Zone Ltd (APSEZ) has entered the global freight forwarding business as it seeks to capitalise on the 45.5 per cent market share in containers handled at India’s ports as well as air cargo terminals in key airports to compete with global players such as DHL, DB Schenker, Mediterranean Shipping Company, Maersk, CMA CGM and help boost volume and revenue. APSEZ’s freight forwarding business is headed by Akshyat Bhatia, Vice President, Logistics.

Bhatia joined the Group in December 2023 as the logistics head for Adani’s energy and power verticals after spending more than 14 years at integrated logistics company A.P. Moller-Maersk. APSEZ’s freight forwarding foray, which started in the last quarter of FY25, has not been reported previously in the media. APSEZ’s logistics vertical posted a 39 per cent growth in revenue in FY25 as India’s biggest private port operator pursued a high-growth trajectory. During FY25, APSEZ expanded into new lines of business via Trucking Management Solution (TMS) and International Freight Network (IFN) services, boosting presence across the value chain and strengthening its integrated transport utility positioning. TMS acts as a marketplace and fulfilment solution to streamline supply chain for customers while International Freight Network services is an integrated platform connecting carriers with end users.

A freight forwarder is an intermediary company specialising in arranging the international shipment of goods. They act on behalf of shippers (cargo owners), coordinating the entire logistics process from origin to destination, including transportation, documentation, customs clearance, and other related services. As much as 70 per cent of the freight forwarding market in India is controlled by multinational corporations such as DHL, DB Schenker, Panalpina, Nippon Express, Yusen Logistics and others. Among Indian players, Allcargo Logistics is a top freight forwarder.

The freight forwarding industry reckons that APSEZ’s foray into this business is part of a strategy to control the entire supply chain similar to the one followed by container shipping lines in recent years to provide end-to-end services by strengthening the landside logistics offerings such as rail, road and warehousing. Globally, Dubai government-owned DP World, one of the world’s top container terminal operators, has ventured into freight forwarding. ‘APSEZ runs key container terminals on India’s western and eastern seaboard, provides last mile services from the container terminals to the end customers and vice versa and operates air cargo facilities at some of the major airports in the country. With international freight forwarding, they want to capture the entire supply chain,’ according to experts.

The 45.5 per cent (and growing) market share of APSEZ in handling containers at Indian ports is a ‘big factor’ in this strategy. ‘The huge container market share will give them a better chance to negotiate with the shipping lines calling at their terminals. They can get a better ocean freight rate than any other company in India. A big chunk of the sea freight carried by the world’s top three container lines to and from India is controlled by them on an end-to-end basis.

APSEZ is of the view that shipping lines will not be able to fully control India’s export-import cargo shipped in steel containers on an end-to-end basis. APSEZ hopes to wean away customers in the hinterland (cargo originating and destination areas) who are currently serviced by third-party freight forwarders, to its fold.