Containers lessor industry.

Container lessor industry is very important part of cargo shipping industry, it provides containers to shipping industry on lease and in turn allow shipping lines to save lot of capital expenditure and also ensures availability of containers at most locations worldwide.

According to preliminary data* published, the annual gross revenues of container shipping lines had grown to $187.7 billion in 2006. Also according to data, the volume of the industry, as measured by loaded container liftings, grew at a compound annual growth rate ("CAGR") of 9.8% from 1980 to 2005.

*Data published by "Drewry"

----------------------------------------------------------------------

----------------------------------------------------------------------

Industry Growth/outlook

Industry outlook is positive due to:

Expected moderate growth rate :- Industry (volume of the industry, as measured by loaded container liftings) is forecasted/expected to grow by approximately 9.0% annually through 2011 and container trade is projected to grow by 9.8% in 2007 and 9.2% in 2008.

Globalization :- Due to rise in globalization the trade among various countries is expected to rise and this will create demand for containers.

Increase shipping capacity :- As of April 2007, the new containership orderbook reached a level of 1,255 vessels, or 4.64 million TEU, representing 48% of the then existing worldwide container ship capacity**. This increased vessel capacity should continue to drive the demand for intermodal containers.

The projected growth in the container shipping industry is due to several factors, including:

• The movement in global manufacturing capacity toward lower labor cost areas such as the People’s

• Republic of China (the "PRC") and India;

• The continued integration of developing high growth economies into global trade patterns;

• The general trend away from bulk shipping and migration to the use of containers; and

• The gradual liberalization and integration of world trade.

Container lessors owned approximately 42.5% of the total worldwide container fleet of 22.2 million TEU as of mid-2006***, with the balance owned by the shipping lines. The percentage of containers utilized by shipping lines and leased from container lessors ranged from 43% to 54% from 1980 through 2006 and is projected to stay in the 42% to 43% range from 2007 to 2015

**According to "Clarkson".

***According to "Containerisation International, World Container Census 2007"

----------------------------------------------------------------------

----------------------------------------------------------------------

This article reflects personal view of the author about the company and one must read offer prospectus and consult its financial adviser before making any investment decision

  TOP