Railways-March-2015.Pdf
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• As of FY14, Indian Railways had 12,617 passenger trains carrying over 23 million World’s third-largest rail passengers daily. On the commercial front, 1010 million tonnes of freight was transported network via trains in FY13 and 1,050.2 million tonnes in FY14 • Private sector companies are being encouraged to participate in rail projects, which were Growing public-private largely in the public domain. In December 2012, the Cabinet approved ‘participative partnership models for rail-connectivity and capacity augmented projects’, which allows private ownership of some railway lines • Indian Railways is constructing dedicated freight lines along the country’s Eastern and Western corridors; this would increase productivity and reduce transportation cost. A special purpose vehicle has been set up for the same. Moreover, in March 2013, the Growth initiatives Cabinet approved the Automobile Freight Train Operator Scheme to encourage automobile transport through railways • Budget 2015 anticipates a diamond quadrilateral network of high speed trains connecting major metro cities and growth centres • Indian Railways launched mobile ticketing services, which enable customers to receive tickets on Short Message Service (SMS). Additionally, it plans to upgrade its current Modernisation/ systems to support bookings of 7,200 tickets per minute compared with the current Technology upgradation capacity of 2,000 tickets • Funds amounting to USD82.5 billion are expected to be spent on projects in next 10 years Source: Aranca Research, Press Information Bureau FY14 GrowingGrowing demanddemand Attractive opportunities 2020F • Increasing urbanisation and rising • Freight traffic is set to increase Gross incomes (both urban and rural) are significantly due to investments and Gross revenue driving growth in the passenger private sector participation revenue segment • Metro rail projects are being USD44.5 USD23.2 • Growing industrialisation across the billion envisaged across many cities over the billion country has increased freight traffic next ten years over the last decade Advantage India Higher investments Policy support • The government has been investing • The government has increased the heavily to upgrade railway infrastructure scope of PPP to beyond providing • The sector has been witnessing maintenance and other such increasing level of FDI participation over supporting roles FY08–12 • The government is providing new lines • Cumulative FDI Inflows from April 2000 and increasing the rolling stock to to November 2014 stood at USD634.1 build up capacity million • Private Investment in MRTS is expected to increase from 13 per cent to 42 per cent during 2012-17 Source: Railway Budget 2014-15, Planning Commission, Press Information Bureau, Department of Industrial Policy & Promotion; Aranca Research Notes: 2017F – MRTS - Mass Rapid Transit System, Forecast 2017, MT - Million Tonnes, FDI - Foreign Direct Investment, FY is Indian Financial Year (April–March), F - Forecast Indian Railways (IR) is: A departmental undertaking of the Government of India (GOI), which owns and operates most of India's rail transport Overseen by the Ministry of Railways As on March 2013, IR has a total route network of about 65,436 kilometres (of which 20,884 were electrified) spread across 7,172 stations It operates more than 19,000 trains daily It has 2.4 lakh wagons, 63,870 coaches and 9,549 locomotives IR’s total assets at the end of FY12 amounted to USD53.8 billion • As on March 2014, 12,617 passenger trains were in operation Passenger • Over 23 million passengers travel by trains daily in India. The number of passengers stood at 8535 million in FY14 Railways • Around 1,050.2 million tonnes of freight was transported via trains in FY14 and 1,101.3 million tonnes is expected in FY15 Freight • These include a huge variety of goods such as mineral ores, iron and steel, fertilisers, petrochemicals and agricultural produce Source: Ministry of Railways, Press release, Railway Budget FY14 – 15, Aranca Research India has the world's third-largest railway network under single management Total revenues (USD million) 59 23,305 FY14 Passenger revenue earnings (USD million) 22 6,217 Freight traffic (million tonnes) 73.2 1,050.2 Number of stations 5,976 7,172 Running track (kilometres) 59,315 FY1951 116,000 Source: Ministry of Railways, Times of India, Press Information Bureau, Railway Budget 2014-15, Aranca Research Revenue growth has been strong over the years; during Gross revenue trends over the years FY07–14, revenues increased at a CAGR of 7.1 per cent to (USD billion) USD23.2 billion in FY14 44.50 Revenues would expand at a CAGR of 8.1 per cent during FY07–15 CAGR: 11.5% The revision in fare effective June 2014 is expected to increase Railway revenues by USD1.3 billion in FY15 23.20 20.75 21.72 21.70 18.25 17.77 18.83 Indian Railway sector aims to boost passenger amenities 14.31 With the improvement in the economy and increasing industrial activity, it is expected that Indian Railway will touch the revenue of USD44.5 billion by 2020 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY20E Source: Vision 2020, Ministry of Railways, Aranca Research Notes: CAGR – Compound Annual Growth Rate, E – Estimates, FY14 and FY15 are Budget Estimates, FY – Indian Financial Year (April–March), * In Indian Rupee Terms In the last eight years, revenues from the passenger segment expanded at a CAGR of 7.3 per cent. In FY14, the total passenger revenue earnings were USD6.2 billion Indian Railways generated USD15.5 billion in earnings from commodity freight traffic during FY14. Earnings growth of 4.9 per cent is anticipated for FY15 Increasing carrying capacity, cost effectiveness, improving quality of service will support the increment in the share of Railway in the freight movement from 35 per cent to 50 per cent by 2020 Passenger earnings (in USD billion) Earnings from freight (in USD billion) 7.4 17.5 6.2 15.8 15.5 5.6 5.9 5.9 14.1 13.3 4.9 4.9 12.0 4.8 11.5 11.3 3.8 9.1 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15F FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15F Source: Vision 2020, Ministry of Railways, Aranca Research Notes: CAGR – Compound Annual Growth Rate, FY – Indian Financial Year (April–March), * In Indian Rupee Terms, F - Forecast Freight business for Indian Railway is supported by nine Revenue break-up by segment (FY14) commodities: coal, iron and steel, iron ore, food grains, fertilizers, petroleum products etc Freight remains the major revenue earning segment for the 7% railways, accounting for 67 per cent of total revenues in Freight FY14, followed by the passenger segment 27% Passenger Profits from the freight segment are used to cross-subsidise the passenger segment Other Coaching 67% To achieve targets of Vision 2020, two dedicated freight corridors, Eastern and Western, would be operation by FY20 Source: Vision 2020, Ministry of Railways, Aranca Research Note: Other Coaching includes service coaches such as pantry cars, parcel vans, mail vans, etc Train travel remains the preferred means of long-distance Trends in passenger volumes (in billions) travel for majority of Indians, a fact reflected by volume and growth of passengers over the years 15.18 Increase in the demand for passenger trains is supported by urbanisation, improving income standards, etc CAGR: 10.1% By 2020, Indian Railway plans to achieve speed of 160 to 8.20 8.60 8.50 200 kmph from current level of 130 kmph or 110 kmph to 7.20 7.65 6.90 reduce the journey hours between important stations 6.20 6.50 Passenger volumes would expand at a CAGR of 6.6 per cent to 11.7 million by FY17 from 6.2 million in FY07 The total number of passengers during FY14 reached 8535 million compared with 8602.1 million FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY20E during 2012–13 Source: Vision 2020, Ministry of Railways, Planning Commission, Passenger traffic is expected to increase to 15.18 Press Information Bureau, Aranca Research billion by FY20 Notes: CAGR – Compound Annual Growth Rate, F – Forecast, E – Estimated, FY – Indian Financial Year (April–March) Annual passenger volumes increased at a CAGR of 4.6 per cent during FY07–14. According to the 12th Five-Year Plan, passenger volumes would expand at a CAGR of 8.3 per cent during FY13–17 Suburban passenger booking during FY14 grew to 4,550 million from 4,473 million in FY13 Non-suburban passenger volumes during FY14 declined marginally to 3,985.1 million The 12th Five-Year Plan estimates suburban and non-suburban passenger volumes to increase to 5.9 billion and 5.8 billion, respectively, by FY17 Indian Railways aims to increase passenger boarding at a CAGR of 8 per cent from 8,224 million in FY12 to 15,180 million in FY20 Number of suburban passengers originating Number of non-suburban passengers originating (in millions) (in millions) 5,917 5,793 5,540 5,385 5,186 5,005 4,473 4,550 4,377 4,129 4,061 3,985 3,590 3,876 3,847 3,802 3,370 3,118 FY09 FY10 FY11 FY12 FY13 FY14 FY09 FY10 FY11 FY12 FY13 FY14 FY15F FY16F FY17F FY15F FY16F FY17F Source: Vision 2020, Ministry of Railways, Planning Commission, Press Information Bureau, Aranca Research Notes: CAGR – Compound Annual Growth Rate, F – Forecast, FY – Indian Financial Year (April–March) As of FY12, railways accounted for 31 per cent of India’s Freight traffic (million tonnes) freight traffic Indian Railways carried 1,050 million tonnes of revenue- 2,165 earning freight traffic in FY14, a 4.0 per cent increase from 1,010 million tonnes in FY13 CAGR: 12.8% Freight traffic is expected to expand at a CAGR of 6.5 per 926 1,010