India is a country on a mission: to become a $5 trillion economy in the next 7 years i.e., by 2030*. The goal is ambitious, and playing a big role in helping India achieve this goal are the transportation and logistics sectors.

*Source: https://www.livemint.com/economy/focusing-on-roadmap-to-make-india-a-5-trillion-economy-govt-11690892172005.html Data as on August 01, 2023

The logistics sector is the link that enables the movement of goods and commodities both within the country as well as beyond its borders. It is the logistics sector that supports a country’s economic well-being and growth.

We need logistical support at every level in the economy, right from transporting vegetables from a farm to the market for consumers, to importing highly advanced machinery from other countries to set up domestic production plants. These commodities need to be transported safely and securely to facilitate industrial or commercial growth.

While logistics takes care of delivering goods, transportation facilities carry us humans around the globe, enabling us to travel anywhere for work or simply enjoy a joyride through the countryside.

Together, they contribute a sizeable amount to the economy. And with India’s self-decided deadline coming closer every day, the crucial role these sectors play has come into the limelight. The Indian government is investing heavily in this arena through the PM Gati Shakti National Master Plan to make efficient multimodal and modern connectivity.

What encompasses transportation and logistics?

The transport and logistics ecosystem encompasses every segment that works tirelessly to send individuals and goods from one place to another. For instance, you want to travel from Mumbai to Delhi. You can opt to travel via rail, road, and air network, book tickets and board cars, buses, trains or airlines. This transportation sector alone makes for airlines, ticketing services, road and rail infrastructure, automakers and automotive component suppliers.

Similarly, moving cargo from one place to another needs a logistics supply chain. This sector comprises commercial transport vehicles (rail, road, sea, and air), warehousing, cold storage, ports and terminals, distribution, last-mile deliveries, e-commerce, dedicated freight corridors and logistics services.

Investing on the go

India is in a sweet spot right now, it is the 5th largest economy, which is capitalising on its young and technologically adept workforce and growing middle class.

Source: https://www.forbesindia.com/article/explainers/top-10-largest-economies-in-the-world/86159/1#:~:text=India%20is%20ranked%205th%20in,services%2C%20agriculture%2C%20and%20manufacturing ; Data as on October 16, 2023

This youth is bringing a combination of innovation, technological know-how and a sense of environment to make transportation and logistics growth more efficient and sustainable.

Young individuals are adopting electric vehicles (EVs). All companies from the service sector to FMCG (fast-moving consumer goods) to e-commerce are running EV fleets to reduce logistics costs of sending goods and services to the end consumer. Catering to this growing demand for EVs, automakers are launching new e-scooters, e-buses, electric cars, and e-autos. The government has introduced production-linked incentive schemes to make automotive components in India.

While EV adoption is growing, companies are making efforts to launch hydrogen cars and trains. India is on track to get its first bullet train. Even airlines are ordering new planes to meet growing air capacity.

The government has launched several tenders to make new airports, railway lines, roads, and modernize ports to ensure efficient and fast transport of goods.

All these developments on the go have created an attractive investment opportunity.

Investing in the transportation and logistics theme

The Aditya Birla Sun Life Transportation and Logistics Fund gives you an opportunity to invest in these ongoing developments that are integral to all industries, sectors, and businesses. The fund aims to give exposure to a large, diversified theme that encompasses 200 companies in 22 basic industries, right from passenger and commercial vehicles (including EVs) to airlines, tyre, ancillary auto parts, e-commerce, tourism, etc.

This open-ended equity scheme invests in small and large-cap stocks of companies that fall within the broad transportation and logistics theme, giving your portfolio smart diversification in sectors with low correlation to the Nifty 50 and Nifty 500 Index.

Give your investment the opportunity to participate in India’s growth journey by investing in the Aditya Birla Sun Life Transportation and Logistics Fund.

Mutual Fund investments are subject to market risks, read all scheme related documents carefully.