Logistics & Value Chain: Market Activity Update H1 2024

ComCap’s latest coverage on the Logistics & supply chain sector focuses is aimed at informing the market players, as well as financial and strategic investors, on the key sectoral trends, market shifts, and M&A / investment trends within the industry

In today’s rapidly evolving global business landscape, the supply chain remains the focal point as companies pursue efficiency, resilience, and sustainability. As we enter 2024, a multitude of trends—including the rapid advancement of technologies like Generative AI, the emergence of SCaS (Supply Chain as a Service) models, and innovations in automation, machine learning, IoT, and blockchain—are driving the shift towards a “smart” supply chain. These developments are poised to reshape the supply chain industry, presenting both new opportunities and challenges.

Our report highlights several logistics trends. We also anticipate an increase in investment and consolidation as financial investors and strategic look for break-out companies, new technologies, and expanded capabilities

Key trends highlighted in the report include:

  • The global logistics market, valued at $5.4TN in 2023, is expected to reach $7.9TN by 2032 at a 4.1% 7-year CAGR driven by a rapid expansion of the e-commerce sector, rising technological advancements and growing consumer demand for faster delivery.
  • Emergence of Supply Chain as a Service model to improve transparency and establish a more effective feedback mechanism for identifying and resolving potential issues.
  • Integration of IoT for real-time visibility and data-driven insights including deployment of IoT-enabled sensors and devices helps businesses to track shipments, monitor inventory levels, and optimize route planning more effectively.
  • GenAI is paving the way for a more agile, responsive, and intelligent supply chain ecosystem. According to IDC’s Survey, 40% of supply chain organizations are channelling investments into GenAI, with a focus on knowledge management applications.
  • The logistics space has cooled in FY’23 from its peak. With 50 private placements (vs. 165 during FY’22) deals volumes are down as much as 70% averaging $86MM per transaction. The most active investors since 2022 include Tiger Global, FJ Labs, SoftBank, Goldman Sachs,  Insight Partners, and Scale Management among others.
  • Logistics M&A witnessed a 37% decline in volume in 2023 compared to 2022. However, a sequential improvement has been noted since Q2’23. The potential for interest-rate cuts may revive the 2024 outlook. Notable deals during 2023 include Bollore ($5.1BN), Omni Logistics ($3.2BN), SAAM Ports ($1BN), and U.S. Xpress Enterprises ($0.8BN).
  • Public comparables: The ERP and Inventory management segment is expected to register the highest median EV/EBITDA multiple of 22.0x in 2024E, followed by other SCM segments at 19.9x and the on-demand delivery segment at 13.3x.