Development of Truck Terminal at Patalganga MIDC Industrial Area

Project Information Memorandum: RFP Section: II

Maharashtra Industrial Development Corporation

August 2009

RFP-Section-II-Project Information Memorandum

TABLE OF CONTENTS
1 INTRODUCTION ....................................................................................................................................... 1 1.1 1.2 1.3 1.4 BACKGROUND .......................................................................................................................................... 1 THE PROJECT RATIONAL AND DEVELOPMENT OBJECTIVES ............................................................................... 1 ADVISOR ................................................................................................................................................. 2 OBJECTIVES AND STRUCTURE OF THE PIM .................................................................................................... 2

2 PATALGANGA MIDC AREA ...................................................................................................................... 3 2.1 INFRASTRUCTURE ..................................................................................................................................... 3 2.2 LIST OF MAJOR INDUSTRIES ........................................................................................................................ 4 2.3 SITE FEATURES ......................................................................................................................................... 4 2.4 NEED FOR TRUCK TERMINAL ...................................................................................................................... 5 2.4.1 PROBLEMS RELATED TO INDUSTRIES.......................................................................................................... 5 2.4.2 PROBLEMS RELATED TO TRANSPORT OPERATORS ........................................................................................ 5 2.4.3 PROBLEMS OF TRUCKERS ........................................................................................................................ 5 2.4.4 ISSUES RELATED TO CIRCULATION AND CONGESTION.................................................................................... 5 3 CURRENT LOGISTICS TREND.................................................................................................................... 6 3.1 VARIOUS LOGISTIC PARAMETERS................................................................................................................. 6 3.1.1 SUPPLY CHAIN SYSTEM ........................................................................................................................... 6 3.1.2 CONSIGNMENT TYPES ............................................................................................................................ 6 3.1.3 WAITING TIME ...................................................................................................................................... 6 3.1.4 TWO WAY TRIPS .................................................................................................................................... 7 3.1.5 CURRENT PARKING AND WAREHOUSING RENTALS ...................................................................................... 7 3.1.6 GOODS FLOW PATTERN AND DISTRIBUTION ............................................................................................... 7 3.2 TYPE OF GOODS IN LOGISTIC MOVEMENT .................................................................................................... 9 3.3 INBOUND LOGISTICS................................................................................................................................ 11 3.4 OUTBOUND LOGISTICS............................................................................................................................. 11 4 DEMAND ESTIMATION .......................................................................................................................... 13 4.1 4.2 4.3 4.4 4.5 4.6 4.7 4.8 4.9 4.10 4.11 CURRENT DAILY CARGO FLOW .................................................................................................................. 13 SPACE REQUIREMENT OF WAREHOUSES ...................................................................................................... 13 WAREHOUSING SPACE REQUIREMENT FOR INBOUND GOODS ......................................................................... 14 WAREHOUSING SPACE REQUIREMENT FOR OUTBOUND GOODS....................................................................... 14 CALCULATIONS FOR TOTAL WAREHOUSING AREA......................................................................................... 14 PARKING SCENARIO ................................................................................................................................ 14 TRUCK FLOW (INBOUND & OUTBOUND TRUCKS) ......................................................................................... 15 FLOW OF TRANSPORT OPERATOR TRUCKS VIA GODOWN ............................................................................... 15 FLOW OF TRANSPORT OPERATOR TRUCKS DIRECTLY SENT TO CONSIGNEE/CONSIGNOR ....................................... 16 FLOW OF PRIVATE CARRIER TRUCKS.......................................................................................................... 16 USER SURVEY FINDINGS FOR PROVISION OF FACILITIES................................................................................. 17

Development of Truck Terminal at MIDC area

RFP-Section-II-Project Information Memorandum

4.12 AREA REQUIREMENT FOR THESE FACILITIES................................................................................................ 17 5 PROPOSED TRUCK TERMINAL ............................................................................................................... 18 5.1 APPROACH ............................................................................................................................................ 18 5.2 PROJECT SCOPE...................................................................................................................................... 18 5.3 PROJECT COMPONENTS ........................................................................................................................... 19 5.3.1 PARKING CENTER (MANDATORY) ........................................................................................................... 19 5.3.2 WAREHOUSE (MANDATORY) ................................................................................................................. 19 5.3.3 DRIVER FACILITIES (MANDATORY) .......................................................................................................... 19 5.3.4 VEHICLE SERVICE CENTER (MANDATORY)................................................................................................. 19 5.3.5 OFFICE CUM COMMERCIAL COMPLEX ..................................................................................................... 19 5.4 AREA PLAN & COMPONENT MIX FOR THE TRUCK TERMINAL ......................................................................... 20 6 KEY FINANCIALS .................................................................................................................................... 22 6.1 PROJECT COST ....................................................................................................................................... 22 6.2 MEANS OF FINANCE ................................................................................................................................ 23 6.3 ASSUMPTIONS ....................................................................................................................................... 23 6.3.1 PREVIEW & SCOPE............................................................................................................................... 23 6.3.2 FORECAST PERIOD ............................................................................................................................... 24 6.3.3 FINANCIAL ASSUMPTIONS ..................................................................................................................... 24 6.3.4 OPERATING ASSUMPTIONS ................................................................................................................... 25 6.3.5 REVENUE ASSUMPTIONS:...................................................................................................................... 25 6.4 PROJECTED FINANCIAL PERFORMANCE ....................................................................................................... 26 7 IMPLEMENTATION WORK ..................................................................................................................... 27 7.1 7.2 7.3 7.4 7.5 7.6 7.7 PPP FORMAT ........................................................................................................................................ 27 TERM OF LEASE ...................................................................................................................................... 27 RIGHT TO RECOVER INVESTMENT .............................................................................................................. 27 CONSTRUCTION PERIOD .......................................................................................................................... 27 RESPONSIBILITIES AS THE PREFERRED DEVELOPER ..................................................................................... 28 SCHEME ................................................................................................................................................ 28 SANCTIONS AND PERMISSIONS.................................................................................................................. 28

Development of Truck Terminal at MIDC area

RFP-Section-II-Project Information Memorandum LIST OF TABLE

Table 3-1: Daily Quantity of Finished Goods Produced .................................................................................................9 Table 3-2: Raw Material Shipment (In 000 Metric Tonnes) ........................................................................................11 Table 3-3: Production/Finished Goods In 000 Metric Tonnes ....................................................................................12 Table 4-1: Total daily cargo flow to and fro Patalganga MIDC area ............................................................................13 Table 4-2: Current Warehousing space requirement for inbound goods ...................................................................14 Table 4-3: Current Warehousing space requirement for out bound goods ................................................................14 Table 4-4: Current Warehousing space requirement for out bound goods ................................................................14 Table 4-5: Inbound and Outbound traffic in Patalganga MIDC area (for Year 2007-08) .............................................15 Table 4-6: Parking demand by flow of Transporter trucks via Godowns (for current year) ........................................16 Table 4-7: Parking Demand by through operator trucks sent directly to Consignee/ Consigner (for current year) ...16 Table 4-8: Parking demand by private carrier trucks (for current year) ......................................................................16 Table 5-1: The broad area plan of the proposed Truck Terminal at Patalganga .........................................................20 Table 5-2: Component Mix requirements for various facilities ...................................................................................20 Table 6-1: Break up of Project Cost .............................................................................................................................22 Table 6-2: Means of Finance........................................................................................................................................23 Table 6-3: Tax Assumptions .........................................................................................................................................24 Table 6-4: Assumptions for Term Loan ........................................................................................................................24 Table 6-5: Land Details ................................................................................................................................................25 Table 6-6: Revenue Assumptions ................................................................................................................................25 Table 6-7: Financial Indicators .....................................................................................................................................26

LIST OF FIGURE
Figure 2-1 : MIDC Patalganga Transport Centre Location .............................................................................................4 Figure 3-1: A waiting queue of inbound trucks in Patalganga MIDC area .....................................................................7 Figure 3-2: A Logistic flow diagram of Patalganga MIDC Area ......................................................................................9 Figure 3-3: Distribution of finished goods by category ...............................................................................................10 Figure 3-4: Distribution of finished goods by commodity ...........................................................................................11 Figure 3-5: Distribution of destinations of outbound finished products in Patalganga MIDC.....................................12

Development of Truck Terminal at MIDC area

RFP-Section-II-Project Information Memorandum 1 1.1 INTRODUCTIONS Background

Maharashtra Industrial Development Corporation (MIDC) (a Government of Maharashtra undertaking), the state level nodal agency is entrusted with and empowered to facilitate establishment of industrial estates and develop common infrastructure for the industries in these estates. Keeping in view the states vision for industrial growth, MIDC has developed Industrial Estates (IE) at various (about 200) locations in the state. The State also offers the finest in Infrastructure, excellent educational facilities, quality trained manpower, a professional work culture and a conducive business environment. The state government has further strengthened the infrastructure through development of road connectivity, power supply, rail and air transport linkages, communications and data networks which has encouraged big industrial houses to set up base in Maharashtra. Owing to above, the state of Maharashtra has emerged as a secure investment destination and is further attracting investors from all over the world. Maharashtra has established strengths in every sector including Engineering, Electronics Hardware, Automobiles and Auto Components, Consumer Durables, Chemicals, Petrochemicals, Pharmaceuticals, Textiles, Information Technology, and Biotechnology. No wonder that a joint survey of leading Indian States conducted by the World Bank along with the CII, found that Maharashtra has the best investment climate. 1.2 The Project Rational and Development Objectives

Most of the MIDC IEs are fully operational with high level of industrial activity. Development of such large industrial base has generated a requirement for logistics facilities including parking space and other ancillary services for commercial vehicles servicing these IEs with raw material and finished goods. In view of the above, MIDC proposes to develop State of the Art Truck Terminals (TT) which would provide ample parking facilities as well as other ancillary logistic components. This Project Information Memorandum (PIM) has been prepared for one such proposed Truck Terminal facility at MIDC Patalganga to be developed on Public Private Partnership (PPP) basis. The TT is envisaged to fulfill the following objectives: Parking facility for the inbound / outbound vehicles Cater to the logistic requirements of the industry with establishment of Warehousing, Offices of Transporters and other ancillary infrastructure Eliminate the parking and loading / unloading instances along the internal roads of the IE. Develop requisite Commercial facilities for sustaining logistics operations and cater to the needs of the working population and visitors. Cater to a proportion of regional goods movements of operators.

Development of Truck Terminal at MIDC area

RFP-Section-II-Project Information Memorandum At macro level it is envisaged that the Truck Terminal would run on a self-sustainable model, on a BOT structure wherein the commercial activities will generate enough resources for the development and long term operations and maintenance of the above said facility. 1.3 Advisor

MIDC has appointed IL&FS Infrastructure Development Corporation Limited (IL&FS IDC) as its advisor for the proposed project. IL&FS IDC has assessed the parking and other requirements of the IE. Based on its assessment, IL&FS IDC has identified components for the project including sizing. Project structuring has been attempted to ensure the techno-commercial feasibility of the project. 1.4 Objectives and Structure of the PIM

The main objective of this PIM is to provide insight to the interested bidder about the following: Project Appreciation and Need for the project; Current Logistics Trend; Market Assessment for the proposed location; Proposed Truck Terminal Facility Components, Sizing and Conceptual Plan; Key Financials; and Implementation Framework

Development of Truck Terminal at MIDC area

RFP-Section-II-Project Information Memorandum 2 PATALGANGA MIDC AREA

The Patalganga Industrial Estate is situated on the left bank of river Patalganga, which is 10 km from Mumbai-Pune National Highway-4, and 7 km from the Mumbai-Pune expressway. It is just 12 km from Mumbai-Goa National Highway-17. The nearest railway station is Rasayani/Apte, on the Konkan railway, which is about 3 km from the area. The Patalganga Industrial Estate is about 75 km from Santacruz domestic airport and Sahar international airport, both located in Mumbai. 2.1 Infrastructure Bridge: To facilitate traffic, for entrepreneurs of the industrial estate, a two lane high level bridge has been built-up on river Patalganga. Common Effluent Disposal Facility: The Common Effluent Disposal Scheme of 15 MLD capacity is under construction through joint ventures with M/s PRIA, MIDC, MPCB and M/s Hydro air ltd. The scheme will take care of effluent collection treatment and disposal. Fire Station: A fire station has been constructed to handle chemical, petrochemical, textile fires, etc. Truck Terminus and Bus Stop: To avoid traffic congestion, spacious parking space has been provided for a truck terminus to park transport vehicles. The terminus has also been provided with basis utilities for drivers, cleaners and truck operator, etc. Electricity: MSEB has two substations of capacity 220KV and 100KV in this area and in Apta village respectively, from which electric supply is supplied to Patalganga Industrial Estate. Water: MIDC has constructed a water supply scheme to cater for 54 MLD and 72 MLD water to the Industrial Estate. The water is sourced by the irrigation department, which tail race release water of Tata hydropower generation at Khopoli. The current water requirement is 20 MLD for Patalganga industrial Estate and 24 MLD for residential area and for outside the industrial Estate. Roads: The Estate is connected internally by multiple lane approach roads and has underground services like storm water collection, effluent collection, water supply etc. The width of the main road is 15 m and that of the internal roads are 7.50 to 5.50 m. Connectivity: The telephone exchange is of C dot type having 5,248 lines capacity; the internet services are provided to the tune of 50 percent. The exchange is connected to Mumbai city and thus facilitates local dialling by prefixing the 95-22 and 95-2192 codes. The exchange also provides ISDN 95-2192 connectivity. Residential Facilities: An area of 69.61 hectares has been developed for residential and commercial use in the residential zone at Patalganga industrial Estate. MIDC has 3

Development of Truck Terminal at MIDC area

RFP-Section-II-Project Information Memorandum constructed a common service center with 21 galas of different sizes, for allotment to restaurants, shops and outlets for various essential commodities 2.2 2.3 List of major industries Reliance Industries Limited Bombay Dyeing manufacturing Co. Ltd INOX Limited Site Features

The tract of land proposed for the Transport Centre is 12.84 Acres in Size, and is located in close proximity to Reliance industries. The land mass is flanked by an arterial road of 35 m ROW. Topographically the land mass is almost flat with a maximum variation in elevation of some 2m. The majority of the land form slopes away from the roadside drain. It is estimated that no extra earth filling would be required for leveling the landmass.

Figure 2-1: MIDC Patalganga Transport Centre Location

Development of Truck Terminal at MIDC area

RFP-Section-II-Project Information Memorandum 2.4 2.4.1 Need for Truck Terminal Problems related to Industries

In Patalganga MIDC area, infrastructure is in good state but industries still face problems related to parking in peak hours. Industries with higher outflow have long waiting queues. Industries are at high demand for parking space or an adequate Truck terminal in the MIDC area. 2.4.2 Problems related to Transport Operators

MIDC Patalganga doesnt have any major transport operators within the premises. The small industries are targeted by the local transport operators which mainly delivered the goods within Maharashtra and near by states only. As the large industries like Reliance Industries Limited have their own logistics facility. Where as medium industries like Bombay Dyeing and Cipla have fix operators for inbound and outbound material movement. There is a possibility for truck terminal and truck operators which can target medium and small industries of this area. Average waiting time was found in range of 8 to 12 hours. The parking for idle trucks is also an important issue related to transport operators. 2.4.3 Problems of Truckers

MIDC Patalganga lacks in the adequate facilities for drivers and Truckers. Patalganga does not have any eating joints and refreshment zone. This area is also lacking in proper service centers, ATM, Commercial and Medical facilities. Truckers also demanded for some sort of lodging facility for them. 2.4.4 Issues related to Circulation and congestion

Patalganga is located along a broad and well maintained spinal road. All the movement happens through this road. The area also has many large open spaces scattered throughout but it lacks in any pre planned parking facility for the trucks. In peak hours there are long roadside parking queues in the area.

Development of Truck Terminal at MIDC area

RFP-Section-II-Project Information Memorandum 3 CURRENT LOGISTICS TREND

The logistics trend has been arrived at through a detailed analysis considering various parameters such as supply chain system, consignment types, waiting time, dwell time of goods for loading and unloading, type of goods in logistic movement and quantum of goods in inbound and outbound flow. These parameters are discussed in detail in the following sections. 3.1 3.1.1 Various Logistic Parameters Supply Chain System

Around 90% of the industrial units send their consignments directly to the customer after paying the Excise Duty. And rest 10% of the industries sends their consignment to the warehouse after paying the Excise Duty. Most of such industries have their own warehouses located in Mumbai or near by area. Such industries are mainly the textiles industries. 3.1.2 Consignment Types

95% of the industrial units located in Patalganga MIDC Area have been producing specific finished products. Thus it was observed that 95% of the industrial units make product specific consignments. Hence from logistics perspective, each container moving in / out of an unit contains raw material or finished product of same type. 3.1.3 Waiting time

The average waiting time differs industry-wise. It was found that many out station trucks reach MIDC area in midnight. As the office time commences around 8 am, they either wait outside the industry premises or at any Dhaba near MIDC till such time (6 to 8 hours of waiting time). Further, as observed in most of the cases, they await their turn for unloading till post lunch session (waiting time increased to 12 to 14 hours). The average waiting time for inbound and outbound trucks was found to be 10 hrs and 8 hrs respectively.

Development of Truck Terminal at MIDC area

RFP-Section-II-Project Information Memorandum

Figure 3-1: A waiting queue of inbound trucks in Patalganga MIDC area

3.1.4

Two way trips

There are very small numbers of inbound trucks which are also used for outbound transport. The main reason behind that is the inbound truck can not be used for outbound use because the finished goods is highly reactive materials i.e. chemicals which can only be loaded in the specific truck of similar material. The absolute share of such trips was found to be less than 5% of total inbound trucks which are mainly applicable for the industries other than chemical. The average layover duration was found to be 9 hrs. 3.1.5 Current Parking and Warehousing Rentals

There is no warehouse facility in this area. A primary survey to find out existing parking charges was also conducted. The charges revealed are as follows: 3.1.6 A parking charge @ Rs. 10 per hour which extends upto Rs. 50 for whole day. Goods Flow pattern and Distribution

The following diagram shows goods flow pattern and their distribution at different stages to understand the logistic flow in the Patalganga MIDC area.

Development of Truck Terminal at MIDC area

RFP-Section-II-Project Information Memorandum

Development of Truck Terminal at MIDC area

RFP-Section-II-Project Information Memorandum

Figure 3-2: A Logistic flow diagram of Patalganga MIDC Area

The current logistics trends have been studied under the following headings 3.2 Type of Goods in Logistic Movement

The type of goods movement and the kind & extent of warehousing requirement decides the logistic within the estate. Patalganga MIDC mainly houses three industries viz. chemicals, oil & gas and textile. The Patalganga area has considerable inflow of raw materials. The daily inflow of raw materials is of the tune of 3,300 metric tones per day. The major share is held by Chemical products followed by Oil & Gases and Textiles. Major share of output / finished goods is borne by chemicals. The following table gives the daily quantity of finished goods in movement.
Table 3-1: Daily Quantity of Finished Goods Produced

Sr. No. 1 2

Commodity Type Chemical Chemical

Name of Commodity Petrochemical Powder

Daily Production
(in metric Tonnes)

860 720 9

Development of Truck Terminal at MIDC area

RFP-Section-II-Project Information Memorandum

Sr. No. 3 4 5 6 7 8 9 10 11 12 13 14

Commodity Type Chemical Chemical Chemical Pharmaceuticals Oil & Gas Oil & Gas Oil & Gas Oil & Gas Oil & Gas Textile Textile Textile

Name of Commodity Acid Hydrocarbon Soda Pharmaceuticals LPG Gas Oxygen/Hydrogen Nitrogen Argon Caliberated Gases Fiber PSF Plastic Cheap Total Production

Daily Production
(in metric Tonnes)

560 85 105 75 192 64 85 55 64 130 70 85 3150

The following chart shows the distribution of finished goods both category wise and commodity wise.

Figure 3-3: Distribution of finished goods by category

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RFP-Section-II-Project Information Memorandum

Figure 3-4: Distribution of finished goods by commodity

It can be observed that about 74 % of the total finished goods are of Chemicals. While looking at the commodity-wise chart major share is hold by Petrochemicals & Powder i.e. 28% and 24% respectively. 3.3 Inbound Logistics

The table below gives the raw material shipment to MIDC Patalganga on a daily, weekly and monthly basis.
Table 3-2: Raw Material Shipment (In 000 Metric Tonnes)

Daily 3.32

Weekly 18.26

Monthly 73.04

More than 90% of raw material arrives from within Maharashtra (excluding Patalganga MIDC and Mumbai). The finished products are delivered in throughout the country with major shares within Maharashtra only. 3.4 Outbound logistics

The table below gives details of finished products produce at MIDC Patalganga on daily, weekly and monthly basis.

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RFP-Section-II-Project Information Memorandum

Table 3-3: Production/Finished Goods In 000 Metric Tonnes

Daily 3.32

Weekly 18.26

Monthly 73.04

Yearly 876.48

Next 5Yr (Yearly Av.) 4382.40

The following pie chart shows the distribution of destinations of finished goods delivered from MIDC Patalganga. A large proportion (45%) of finished goods is sent to states other than Maharashtra.

Figure 3-5: Distribution of destinations of outbound finished products in Patalganga MIDC

As stated above there are both big and small industrial units located on the site. The bigger chemical industries provide finished chemicals as a raw material for various kinds of processing industries. Industries in Patalganga area are basically act as a supportive industries which provide chemicals as a raw materials to various other kind of industries for production of their final products. It is observed that different raw materials brought in this site for refinement and it further distributed to various kind of other industries for the processing of their final products. Due to the complication of raw and final product the industries prefer to store their raw and finished products in there own godowns under intensive care and management because of the delicate product mix.

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RFP-Section-II-Project Information Memorandum 4 DEMAND ESTIMATION

To understand the parking and warehousing demand for the proposed facilities, following surveys and studies have been carried out: a. b. c. d. e. Classified Traffic Volume Survey Origin Destination Survey Transport Agencies Survey Interviews of truck drivers Opinion surveys of stakeholders including industrial units, fright forwarders and various facility providers

Out-come of above surveys and its analysis is discussed below. 4.1 Current Daily Cargo Flow

In terms of cargo flows to the Patalganga IE, calculations were made by using the tonnage of freight as well as the number of trucks entering and exiting the site
Table 4-1: Total daily cargo flow to and fro Patalganga MIDC area

Incoming No. of Trucks Cargo Flow (Daily in metric tonnes) 4.2 332 3320

Outgoing 329 3150

Total 661 6371

Space requirement of warehouses

The following categories of warehouses are anticipated at the transport centre: General inbound and outbound goods Manufacturers excised out finished goods In transit goods to and from the MIDC to reduce idle waiting periods for trucks General users who might like to use the warehousing for goods not directly related to the Patalganga MIDC

For the purpose of differentiation the total goods inflow requiring the warehousing facilities as categorized above have been assumed to fall under the following categories: Weather protected godowns assumed to function using mechanized forklifts, pallets and racks

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RFP-Section-II-Project Information Memorandum 4.3 Open yards for non mechanized storage Warehousing space requirement for inbound goods
Table 4-2: Current Warehousing space requirement for inbound goods

Total Goods daily of Flow Inbound through Goods Operator

(tons)

% of trucks using godown 10%

Operator goods coming to Godown 318.72

Average Dwell Time

Avg. sq. Ft. per tonne for 3 levels 3.59

Space in sq ft

Floor Space in Acres

3320

3187.2

10

11442

0.26

4.4

Warehousing space requirement for outbound goods

Table 4-3: Current Warehousing space requirement for out bound goods

Total Goods daily of Flow outboun through d Goods Operato r 3150 4.5 3087

% of trucks using godown 10%

Operato Average r goods Dwell coming Time to Godown 308.7 8

Avg. sq. Ft. per tonne for 3 levels 3.59

Space in Floor sq ft Space in Acres

8865.86 4

0.20360 2

Calculations for total Warehousing Area

Table 4-4: Current Warehousing space requirement for out bound goods

Floor Space for inbound Goods in Acres 0.262764 4.6

Floor Space for Outboun d Goods in Acres 0.203602

Net Floor Space in Acres@45 % of Total Warehouse 0.47

Inner Amenities Circulat @ 10% ion @ 25% 0.26 0.10

Outer Circulati on area @ 30% 0.31

Total warehous e area (in acre) 1.036369

Parking Scenario

Most of the factories located in the industrial estate have provision for their loading / unloading bays. However, parking space for trucks waiting to execute loading / unloading is at a very small scale. Long queues of trucks line the roads during day time. Also parking would be required for overnight halt of loaded as well as unloaded trucks. Normally there are three types of parking trends observed as listed below: Industries which have their own fleet of trucks either dont have their own parking space or have inadequate parking space to accommodate their idle vehicles. The larger

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RFP-Section-II-Project Information Memorandum industries in the MIDC Patalganga, on the contrary, have a total parking space of only 220 truck spaces inside the premises. Transport operators which have larger fleet of trucks dont have enough parking spaces to accommodate all their vehicles. While the operators who have a smaller fleet, dont have any parking space of their own. It has also been observed that these operators generally have a waiting time for trucks of about 1-2 days. Individual truckers dont have any parking space for halt. So they usually park their vehicles outside the destination industry premises or at any Dhaba near the MIDC site.

Thus by combining all the parking requirement for trucks under all categories, following three types of parking needs are identified: 1. Parking for Idle trucks 2. Parking for Transit trucks 3. Parking for other vehicles 4.7 Truck Flow (inbound & outbound Trucks)

The demands for inbound as well as outbound trucks vary every day for all the industries Lorentz curve analysis shows that the large sized industries which are only 10% of the total functional industries contribute to about 50% of the vehicular traffic generated in the Patalganga MIDC area.
Table 4-5: Inbound and Outbound traffic in Patalganga MIDC area (for Year 2007-08)

No. of Incomi ng Trucks 332 4.8

Avg. Load per truck 10

Cargo Inflow 3320

No. of Outgoin g Trucks 329

Avg. Load per truck 9.3

Cargo Outflow 3059.7

Cargo Availabl Truck Flow to e Truck Space Industri Parking Require es daily Space d 6379.7 220 441

The estimated existing demand of Truck outflow in the area is 441 trucks per day. The estimated existing demand of Truck inflow in the area is 332 trucks per day. The estimated existing parking bay for trucks in the area is 220 truck spaces. The inbound trucks used for outbound transport are 133 (40 % of Inbound trucks). Total truck flow in the MIDC site comes out to be 441 trucks. Flow of Transport Operator trucks via Godown

It was observed in the truckers survey, that 96% trucks plying at Patalganga are through transport operator and of Industries itself. Rest 3 % trucks are either from private carriers.

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RFP-Section-II-Project Information Memorandum

Table 4-6: Parking demand by flow of Transporter trucks via Godowns (for current year)

Total daily flow of trucks 574

Truck Flow by Pvt. Operator/ Industries (97%) 556.78

% of trucks using godown (including Industries) 90%

Operato r Trucks using Godown 501.102

Avg. Waiting Hours 12

Total truck space hours 6013.224

Working Hours

Number of truck spaces 251

24

A= 251 4.9 Flow of Transport Operator trucks directly sent to consignee/consignor

Table 4-7: Parking Demand by through operator trucks sent directly to Consignee/ Consigner (for current year)

Total daily flow of trucks 574 B=10 4.10

Truck Flow though direct consignme nt (3%) 22.96

Trucks % of directly trucks sent to not using Consigne godown e 90% 20.664

Avg. Waiting Hours 12

Total truck space hours 247.968

Worki ng Hours 24

Numbe r of truck spaces 10

Flow of private carrier trucks

Table 4-8: Parking demand by private carrier trucks (for current year)

Total daily flow of trucks 574 C= 129

Truck Flow % trucks by Pvt. coming Carriers to (50%) terminal 287 90%

Trucks Coming to terminal 258.3

Avg. Waiting Hours 12

Total truck space hours 3099.6

Worki ng Hours 24

Number of truck spaces 129

Sum A+B+C is equal to 251+10+129 = 390 It is estimated that about 30% trucks shall be parked inside the respective industrial units and float on the highway. Hence, it is estimated that parking facility is required to be provided for about 275 trucks. As per the UDPFI norms one truck requires 28.0 Sq. m area for parking and circulation. Based on this it is estimated that approximately 1.9 acres is required to be provided for Truck Parking.

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RFP-Section-II-Project Information Memorandum 4.11 User survey findings for provision of facilities A comprehensive user opinion survey was conducted for finding out the various facilities to be located within the logistics center. About 80% of the users want restaurant and lodging facility at the first place. The following is the list of facilities in the priority order a. b. c. d. e. f. g. h. Restaurant Lodging Washing Spare Parts Medical Facilities ATM/Bank Petrol Pump Entertainment Facility

4.12 Area requirement for these facilities Area requirement for open parking (1 truck space@28sqm.) Area required for warehouses Area for transport offices 1.90 acres 1.03 acres 0.5 acres

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RFP-Section-II-Project Information Memorandum 5 5.1 PROPOSED TRUCK TERMINAL Approach

An attempt to develop the proposed Truck Terminal as a model necessitates, a rational and replicable approach, which can become the basis for similar planning efforts for other locations. A basic conceptual approach followed to develop Truck Terminal site is as follow: Creating an efficient business environment by providing a mix of practical and sound facilities combined with convenient environment to the users. Well-planned and fully serviced site with all physical infrastructure and connectivity by roads, drains, electricity, sewerage and water supply, telecom and data networks. Visually appealing and functionally effective landscape. Creation of aesthetic designs and elevations, particularly the faade, including a distinctive entrance. Project Scope

5.2

In keeping with the requirements of the industrial area and the limitations imposed by the availability of the land, the proposed Truck Terminal will have the logistical facilities and all support facilities including the internal site infrastructure and services. The logistical facilities shall include inter-alia paved parking for trucks / heavy commercial vehicles, open & secure warehouses, offices of transporters and Carriage and Forwarding Agents (C&FAs). The support services shall include vehicle service center & fuel station, driver dormitory and a dhaba, dispensary, primary healthcare center, and other commercial facilities as retail shopping, offices of banks / ATMs / insurance cos., shops for spares, tyres, batteries & vehicle accessories, company outlets, and food courts. All the above activities shall be clearly zoned within a designated area to be developed like an integrated complex. An illustrative Conceptual Layout Plan for the proposed Truck Terminal with zones identified for various activities has been prepared. The facilities namely Vehicle Parking, Warehousing, Drivers Facilities, Vehicle Service Center and Transport Operators offices are mandatory. A list of component mix and area requirements for various proposed facilities has also been prepared. The bidders may refer to the conceptual plan for deciding upon the component mix and area configurations. This zoning and bundling of services has been suggested keeping in view the ease of functionality, but some components and their placement in the master plan may be altered when the actual master plan is being prepared by the selected developer.

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RFP-Section-II-Project Information Memorandum 5.3 Project Components

Broadly, the Truck Terminal is being planned for the following components. 5.3.1 Parking Center (Mandatory) Fully Paved parking for trucks/ heavy commercial vehicles with well designated bays for various types of vehicles. Control room at entrance to Truck Terminal having a Public Address (PA) system and telecommunication link. PA system will have coverage of various important functional areas. The control room is expected to serve as a centralized point of contact for the logistic operators and industrial units. Offices for Transport Operators and Clearing &Forwarding agents Warehouse (mandatory) There is a requirement for both closed (secured) as well as open warehouse, equipped with all modern facilities viz. racked storage system, mechanical handling system, loading & unloading bays with dock levelers, pest control, fire protection system etc. 5.3.3 5.3.4 5.3.5 Driver Facilities (mandatory) Driver dormitories (no of dormitories to be decided at consultation to MIDC) Driver restrooms, Canteen/ Economical restaurants Dispensary & Primary Health Centre Vehicle Service Center (mandatory) Development of service station with facilities like Vehicle Service Bays, Vehicle Washing Bays, Greasing Bays, Tyre Center, Accident Repair Job etc. A fuel station Office cum Commercial Complex

5.3.2

This facility, apart from other utilities may house following: Retail Shops Banks/ ATMs Business Center Restaurants/ Food Court Mini Theatre for entertainment of the transport community. RTO Extension counter. 19

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RFP-Section-II-Project Information Memorandum 5.4 Office of insurance companies/ Financial Institutions Spare Parts/ Tyre shops/ Vehicle accessories shop/ other related shops. Offices of transport companies, cargo-tracking services etc. Area Plan & Component Mix for the Truck Terminal

Based on the demand assessment, the area requirement for various components for proposed Truck terminal is coming around 8.2 acres. However the area allotted by MIDC is 12.84 acres. It is proposed that remaining area may be kept reserved for future expansion of the facilities. The distribution of the area for various facilities is given below.
Table 5-1: The broad area plan of the proposed Truck Terminal at Patalganga

Sr.No 1 2 3

Broad Use Transport operators Office, godowns, loading/unloading Service industry petrol pump, service area weigh bridge, etc Public /semi public police post, post office, telephone, first aid etc. Commercial Parking idle, transit, other vehicles Open spaces Circulation Total

Percentage Area 18.70 6.60 2.64 13.20 23.23 13.20 22.44 100.00

Area in acres 1.53 0.54 0.22

4 5 6 7

1.08 1.90 1.08 1.84 8.18

The broad area breakup provided by the above table is in accordance with the UDPFI norms. It may be noted that the predominant use of the above mentioned area is distributed amongst transport operator offices, warehouses, and truck parking area. The following table provides the component mix of various mandatory and other desired facilities in the proposed Truck Terminal.
Table 5-2: Component Mix requirements for various facilities

Major Components Truck Parking* Offices of Operators*

Required Facilities Paved Parking Transport/ Logistics Companies Clearing & Forwarding

Minimum Area Requirements 1.90 Acres Sizing to be decided by the Developer within the permissible guidelines

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RFP-Section-II-Project Information Memorandum Major Components Required Facilities Cos. (C&FA) Open & Secured Ware Houses with pest control facility Vehicle Service & Repairs, Accident Jobs, Washing and Greasing Bays etc., Fuel Pump with storage and dispensers Driver Dormitory with at least 120 beds Dispensary and Primary Health Care Canteen/ Economical restaurant Food Courts/ Restaurants Shopping center/ATM/Bank Minimum Area Requirements

Ware House*

1.03 Acres

Service Station*

Sizing to be decided by the Developer within the permissible guidelines

Drivers Facilities*

Commercial Facilities

Sizing to be decided by the Developer within the permissible guidelines

Note: * denotes the mandatory facilities to be provided in the Truck Terminal. It may be noted that in addition to the Parking and Warehouse, the Drivers Facilities and Operators facilities are also mandatory requirement of Truck Terminal. Based upon the functional utility and circulation pattern, developer has freedom to decide the area configuration on its own for the proposed facilities, subject to development of mandatory facilities as mentioned. The developer has to abide by all the applicable building bye laws and developmental control regulations while planning the facilities in the Truck Terminal (Refer MIDC website DCR Guideline).

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RFP-Section-II-Project Information Memorandum 6 KEY FINANCIALS

Project financials will comprise of the project development cost, revenue streams and project feasibility. Project financials have been prepared considering all the Project Components as have been considered during the project development phase. An overall financial model has been prepared that consolidates the financials of all the project components and highlights returns expected from the project. The viability of the project is evaluated on the basis of two parameters viz. Project IRR and Equity IRR. The land will be leased to a developer who would execute development of the various areas. The lease premium that can be expected from the developer is based on the return that a developer can expect from the development of the proposed projects. This chapter covers the financials projection related to the project. 6.1 Project Cost

The total cost of the project has been estimated at approximately Rs. 28.91 crore (including land cost). The detailed break up of each of the cost elements is presented in the table below:
Table 6-1: Break up of Project Cost

Project Cost Land Cost Site Development Cost Construction Cost Contingencies Preliminary & Pre-operative exp Interest During Construction Total

Amount (Rs. crore) 10.39 3.57 10.43 1.22 0.87 2.43 28.91

Land - Land aggregating to 8.2 acres has been allotted for the project in the MIDC area. The estimated cost of this land parcel at ongoing industrial rates is Rs. 10.39 crores. Site Development The entire land is proposed to be appropriately cleaned, cleared of unwanted objects and leveled (as required) and it is assumed that the cost of such site development per sq ft would be Rs 100. The estimated total cost of site development has been calculated at Rs 3.57 crores Construction Costs (Rs. 10.43 crore) a) Logistics Area (Parking, Warehousing, Circulation) For the logistics component of the project, the per sq.ft. Construction cost has been estimated at Rs. 650. For the total Logistic

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RFP-Section-II-Project Information Memorandum space of 92,870 sq. ft., the cost of the Logistics component has been calculated at Rs. 6.19 crore*. b) Logistics Support Services- The logistics support component of the project includes petrol pump, weigh bridge, service centre. The estimated per sq.ft. Construction cost for petrol pump is Rs 1000, for Weigh Bridge Rs 600 and for service centre Rs 550. For the total Logistic support service space of 17,853 sq.ft., the cost of the Logistics support service component has been calculated at Rs 1.43 crore*. c) Office Area- For the office component of the project, the estimated per sq.ft. construction cost is Rs. 550. For the total Office space of 17,860 sq ft, the cost of the office component has been calculated at Rs 1.02 crore*. d) Commercial Component- For the total commercial space of 32,147 sq ft, the construction cost has been calculated at Rs 1.79 crore*.

Contingencies- A provision for Contingency has been estimated at 5% of the total cost Preliminary & Pre-operative Expenses- A provision for consultancy expenses has been estimated at 3% of the total project cost Interest During Construction (IDC)- Interest During Construction (IDC) @ 12.00% p.a. for the debt draw down period of 2 years has been computed based on the proposed phasing of expenditure & debt draw down schedule. IDC has been calculated at Rs. 2.43 crore. 6.2 Means of Finance

The funding requirements towards the project cost shall be met by a combination of Promoters capital and debt from banks as given in the table below:
Table 6-2: Means of Finance

Sr. No 1 2 6.3 6.3.1 Assumptions Preview & Scope

Means Equity Capital Term Loans (TL) from Banks Total

Amount (Rs. Crore) 8.67 20.24 28.91

Based on the project cost figures & financing plan presented in the chapter on Project Cost & Means of Financing and the assumptions listed below, a base-case Business Plan (Business Plan) has been prepared for the Project.

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RFP-Section-II-Project Information Memorandum 6.3.2 Forecast Period

The forecast period is for a period of Twenty-eight years (lease period of thirty years less two years construction period), which covers the entire period from the draw down of debt till the last date of debt servicing for the Project. The project construction/development is expected to continue for a period of 24 months. 6.3.3 Financial Assumptions Taxes & Accounting policies
Table 6-3: Tax Assumptions

Taxation Minimum Alternate Tax (p.a) a) Book Profit < Rs. 1 Crore b) Book Profit > Rs. 1 Crore Corporate Income Tax (p.a) 15.45% 16.995% 30%

Taxes payable on the cash flows generated from the Project (in the financial model) have been levied at the rates delineated in the table above. Terms of Financing

The following are the salient features of the term loan

Table 6-4: Assumptions for Term Loan

Proposed Debt Term Loan

Rupee Term Loan Rs 20.24 crore

Door to Door Tenure 8 years Upfront Bank charges 0.5 % Moratorium Period Repayment Period Interest Rate Working Capital 4 quarters from COD 7 years 12.00% p.a.

Given the nature of operations, it has been assumed that there will be minimal or no requirement for working capital.

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RFP-Section-II-Project Information Memorandum 6.3.4 Operating Assumptions

The following table shows a summary of the land and the area breakup between the residential and commercial components of the Project: Land Details

Table 6-5: Land Details

Land Details Total Area (acres) Acres to Sq ft (sq.ft.) Logistics Area (sq.ft.) Logistics Support Area (sq.ft.) Office Area (sq.ft.) Commercial (sq.ft.)

8.20 357193 92870 17853 17860 32147

Operating Cost Assumptions: Operating Expenses are taken at 3% of the project cost 6.3.5 Revenue Assumptions:
Table 6-6: Revenue Assumptions

Particulars Rate Warehouse & Allied Services 20 Parking (Idle, Transit, other vehicles) 2 Petrol Pump Weigh Bridge 100 Service Center (Spare Parts & 100 Washing) Transporter's Office 35 Banks & ATM 30 Insurance Office 15 Communication Services 8 Dispensary 0 Auto Mart (Shops) 35 Restaurant 30 Lodging 30 Advertisement 9000 Escalation (Warehouse) 3% Escalation (Others) 5%

Unit Rs per sq ft per month Rs/truck space hr/per day Commission on revenues Rs./ truck Rs./ service / truck Rs./ sq ft p.m. Rs./ sq ft p.m. Rs./ sq ft p.m. Rs./ sq ft p.m. Rs./ sq ft p.m. Rs./ sq ft p.m. Rs./ sq ft p.m. Rs./ sq ft p.m. Rs./ hoarding p.m. p.a. p.a.

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RFP-Section-II-Project Information Memorandum

6.4

Projected Financial Performance

The Key Financial indicators for the Project are presented in the table below:
Table 6-7: Financial Indicators

Particulars Project IRR Equity IRR Average DSCR

Amount (Rs.) 9% 13% 0.73

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RFP-Section-II-Project Information Memorandum

7 7.1

IMPLEMENTATION WORK PPP Format

The project is to be developed on public-private-partnership (PPP) basis on Design- BuildFinance-Operate-Transfer (DBFOT) model. Under this model, the developer designs, finances, constructs, sub lease subject facilities for a period lesser than or co-terminus with the concession term, and operates and maintains the facility during the term of the lease period. The land and facilities developed will automatically revert back to MIDC at the end of the concession period and lease term. 7.2 Term of Lease

The Concession Period shall commence from the execution of the Concession Agreement (Compliance Date) (refer Vol II Draft Concession Agreement) and shall extend to a period of 30 (thirty) years from such date or the earlier termination or any extension of the Concession Agreement. For the avoidance of doubt, the Concession Period shall include the Construction Period. After the expiry of first phase of 30 (thirty) years, MIDC shall call for another bidding process. The existing operator, shall be made the first offer to match ( upto 90%) the highest valid upfront lease premium through the valid bid offered during the second bid. Should the existing operator match the bid, MIDC shall offer to extend the Concession period by another 30years to the existing bidder selected in the first phase. 7.3 Right to Recover Investment

The Developer for the Truck Terminal, would be given the right(s) to recover its investment, through the Sub Lease/License of logistics facilities such as warehousing, parking, service & fuel station, other project facilities & commercial facilities like restaurants, transport & related offices, banks, advertisements etc. Refer Volume III- Draft concession agreement, of this RFP document. 7.4 Construction Period

The selected DEVELOPER will submit the development plan, including the master plan, within 60 days of signing of concession agreement, to MIDC for approval. Once the plan is approved by MIDC, the developer may carry out development work in phases, subject to completion of all the mandatory components (listed in Section 5) of this document within stipulated time period of 24 (Twenty Four) months from the date of approval of development plan/ project scheme by MIDC or the Approval Date (For Approval Date, Refer Vol III Draft Concession Agreement). Additionally, out of the total site area, 1.9 acre of parking space, 1.03 acres of warehousing space has to be earmarked. Of the total parking & warehousing area, 1.9 Acres or 100% of the stipulated parking area (which ever is higher) & 0.5 Acres or 50% of the stipulated warehousing area (which ever is higher) should be completed and made available for usage within 12 months of submission and approval of the Construction documents / Truck Terminal project scheme by 27

Development of Truck Terminal at MIDC area

RFP-Section-II-Project Information Memorandum MIDC. The 100% parking & 50% warehousing in 12 months has to be phased in such a manner that minimum 20% of the total stipulated parking space is developed in each month of the above stipulated period. Reference is invited to RFP Volume III- Draft Concession Agreement, clause 9.3 Construction of Truck Terminal, for details in this regard. 7.5 Responsibilities as the Preferred DEVELOPER

The Preferred DEVELOPER will decide on the final mix of different types of sub components and shall be fully responsible for detailed planning and design of each type. However, this flexibility will be subject to overall Development Controls, provision for mandatory facilities and General Specifications/Guidelines/Parameters for various components of the project, including the On-Site (internal) Infrastructure. The zoning of the Master Plan should be such that there is no hindrance/ obstruction regarding the functional utility of the proposed facilities. (Refer to MIDC website DCR Guideline). The development shall be in accordance to the MIDC guidelines. The Preferred DEVELOPER will have complete flexibility in deciding upon the dispersal of components and sub components within this site, as well as the layout of roads and open spaces within these zones/plots, subject to the development potential and controls for each facility as per the Developmental control regulations and MIDC guidelines. 7.6 Scheme

Following the selection of the Preferred DEVELOPER, within 60 days from date of signing of concession agreement, the same would be required to prepare a Truck terminal development plan/ project scheme conforming to the provisions within the RFP documents (including the Draft Concession Agreement) that will cover, inter alia: Detailed layout plan including technical drawings for the entire Truck Terminal Detailed building plans of each component/facility proposed inside the Truck Terminal Project Implementation/Construction schedule with identified milestones, including the phasing of the project, if any.

The site development plan along with other relevant details shall be submitted to MIDC within 60 days of signing of Concession Agreement with the successful bidder. Construction etc. shall commence, within 30 days, only after approval of the Project Scheme/ Truck Terminal Master Plan by MIDC. 7.7 Sanctions and Permissions

The responsibility of getting the approvals on Site development plans and detailed building plans rests with the developer. The preferred DEVELOPER shall obtain and maintain at its cost all Applicable Permission and clearances in conformity with the Applicable Laws for the Project and be in compliance therewith. Subject to the DEVELOPER complying with the Applicable 28

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RFP-Section-II-Project Information Memorandum Laws and Good Industry Practice, MIDC by itself or through GoM (Government of Maharashtra) shall facilitate the securing of such sanctions, clearances and applicable permission.

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