On September 17, the government announced the National Logistics Policy to develop a cost-efficient and integrated logistics ecosystem for India.
The government plans to reduce logistics costs to below 10 percent of the current 13 to 14 percent of GDP in eight years.
This would be in line with developed countries such as the US and Germany, where logistics costs are between 7% and 9%.
To reduce these costs, the government has launched several initiatives such as Integration of Digital System, Unified Logistics Interface Platform, Ease of Logistics, Network Planning Group and System Improvement Group.
Not only will these measures bring different forms of logistics routes under one centralized platform, it will also reduce any operational inefficiencies through a digital resolution platform.
While some of these policies may take time to materialize, analysts believe that platforms such as Unified Logistics Interface Platform and Ease of Logistics can reduce logistics costs in the medium term.
Speaking to Business Standard, Ronald Siyoni, AVP, Research, Sharekhan by BNP Paribas, said the National Logistics Policy (NLP) will curb unscrupulous activities. Organized players are likely to benefit. Bullish on TCI Express, Mahindra Logistics, Gati. NLP positive for autos and cement sectors
That said, analysts believe the synergies of the new policy are already priced in.
Ambareesh Baliga, Independent Market Analyst, believes NLP will help minimize logistics costs. New policies to bring about leadership change. Logistic stocks already priced in National Logistics Policy. There is no upside in the short term, he says.
Meanwhile, the shares of Aegis Logistics, Allcargo Logistics, Concor and VRL Logistics on the stock exchanges this calendar year 2022 (CY22) have risen by 2 to 50 percent so far. In comparison, the Nifty50 and the S&P BSE Sensex gained two percent each over the same period.
FII flows, rupee movement, crude oil prices, global signals will continue to lead domestic markets today.
The ECB Christine Lagarde's speech on the interest rate trajectory will be followed worldwide. The two-day US FOMC meeting also begins today.
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