“Private Stage Carriage Corporatisation in Delhi” · 1 Pre 1950 stage carriage operation...

Delhi Transit

“Private Stage Carriage Corporatisation in Delhi”

Discussion on RFQ Document

Investor Meet

March 26, 2008

@ DIMTS Limited, 2008

Delhi Transit

S. No Particulars Year Number of Permits

1 Pre 1950 stage carriage operation 1940-50 108 permits

2 Old scheme 1971 100 mini buses

3 Ex-servicemen scheme 1973-74 120 mini buses

4 Graduate scheme 1975 100 mini buses

5 Scheme for SC/ST 1981 68 permits

6 Point to point scheme (Asiad) 1982 300 permits

7 Luxury (White line scheme) 1991 100 permits

8 Red line/Blue line scheme 1992 3000 permits

9 Suvidha 1993 609 permits

10 New scheme for CNG buses 2002 637 permits

11 Erstwhile KM scheme 2002 (April) 2,772 permits

History Of Private Sector Bus Operation In Delhi


Delhi Transit

3

Type of BusNumber of Buses

City Interstate

Contract carriage 2,957 2,727

Light Contract carriage 2,144 1,421

DTC (Stage Carriage) 3,106# 338

Private Stage Carriages (Blueline) 3,849 ..

DMRC and other mini buses 986 ..

Buses of Educational Institutions 124* ..

Sum Total 13,166 4,486# Includes 213 CNG buses plying in National Capital Region * Including 20 Light Passenger Vehicles Source: STA as of 25 October 2007 and DTC Operational Statistics

Number Of Buses For Different Types Of In-city Transport In Delhi

There are approximately 17 terminals and approximately 6,400 Bus

stops in Delhi.


Delhi Transit

4

0.5%0.3%0.2%0.2%0.9%1.3%1.8%4.1%

14.4%

76.3%

181098654321

Size of Operator (No. of Buses)

Sh

are

of

Bu

s F

leet

Distribution of Blue line fleet size by size of operator

The majority of the private stage

carriage permits came into being

through “A Scheme for Private Bus

Service in Delhi under Stage Carriage

Permits”, which was advertised in

the year 1992.

Stage carriages introduced under

this scheme quickly came to be

known as Redline buses owing to

the prescribed color code. Soon

after introduction, these buses were

involved in a spate of accidents.

This led to the color code of the

buses being changed to blue and

they came to be known as Blue line

buses.

Private Stage Carriage in Delhi

2004 2005 2006

DTC 3,904 4,815 4,612

Blue Line 69,282 59,536 48,750

Ratio 17.7 12.4 10.6

Source: Road Accidents in Delhi, various issues.

Offences Committed by DTC and Blue Line Buses


Delhi Transit Problems With Existing Operation

Accidents and traffic violations.

Undesirable

Driving practices

“Theka” System

Waiting anxiety and unsafe passenger behavior

Reduction in unremunerative services and routes

Lack of network benefits

Predation by incumbents or cartelization

Multiplicity of permit conditions

Impounding of vehicles

Unviable fare structure

Lack of financial support to enable system improvement

Absence of bus lane enforcement


Delhi TransitAnalysis of Problems and Reform Model Essentials

Reducing accidents and traffic violations.

Need to segregate traffic.

Reducing undesirable driving practices.

Monitoring through Intelligent Transport Systems.

Driver training, certification and verification.

Contractual practices.

Vehicle choice and maintenance.

Reduction in waiting anxiety.

Service provisions on non-profitable routes.

Ensuring network benefits.

Preventing predation by incumbents or cartelization.

Reducing multiplicity of permit conditions.

Introducing suitable incentives and disincentives.

Financial support for public transport.


Delhi Transit

DIMTS

GNCTD

Operator

Corporatisation of Private Stage Carriage

Operation in Delhi

O I N

Parties

GNCTD - Government of National Capital Territory of Delhi


Delhi Transit Private Stage Carriage Services

Owning to the increasing irregularly of blue-line buses, the government is looking to overhaul the current system.


Delhi Transit “Private Stage Carriage Corporatisation”

GNCTD has launched a scheme to privatise the stage carriage (known as Blue-line) buses operation.

Delhi – Total Area All bus routes in Delhi have been

aggregated into seventeen (17)

clusters.

Private players can operates their

fleet in one or more clusters, after

fulfilling all the criteria.

The contract will be awarded for a

period of 10 years.

Each cluster may have more than one

type of bus such as standard, semi-

low floor and low floor.


Delhi Transit Scheme Objectives

• Universality, i.e. availability of services on all

scheduled routes.

• Continuous improvement of the service.

• Integrated character, punctuality and passenger

comfort.

• Restricting on-road competition.

• Increased monitoring in real time.

• Progressive improvement and integration of the

system with other modes of transport.

S AFETY

U NIVERSALITY

E CONOMICAL

C OMPETITION

M ONITORING

I NTEGRATION


Delhi TransitOutline of Concession Agreement

Bus services under the scheme will be provided by

separate independent private entities.Operators

All the existing 657 routes will be covered by the scheme

in phased manner.

Permits will be co-terminus with the concession

agreement.

Existing routes are clustered into suitable bunches of

routes such that competing routes do not overlap across

operators.

Each of these clusters will be serviced by a single private

operator and DTC.

The operator will be required to provide a scheduled bus

service based on Unified Time Table for all the operators

including DTC.

Routes


Delhi TransitOutline of Concession Agreement

Selection of the private operator (company) will be

through competitive bidding.

The operator will have to meet criteria related to the

„quality and specifications‟ of buses, „qualification and

experience‟ of crew and adherence to „performance

parameters‟.

Selection Process

All buses under the concession will be branded to

identify the operator and the “Delhi Transit” operation.

Premium Services

The operator will be free to offer premium services in

addition to the regular services.

Branding


Delhi Transit Role of DIMTS Limited

Planning, management, control and monitoring as a

concession manager.

Ensuring adherence to operational and environmental

standards through monitoring and systems of incentives

and disincentives.

Management of common infrastructure.

Dispute resolution through a two stage process.

Management of revenue sharing arrangement between

operators through an escrow account.

Contract monitoring and management.

Interface between the regulatory authority and the

concessionaire.


Delhi Transit Implications for GNCTD

Restructuring of institutional frameworks for

– Regulation, planning and operational functions

– Enforcing UTT (through concession manager) and

regulating tariff structure

– Facilitate access to public assets such as depots

available for private sector operators

– Mobilizing private investment for public services

Facilitating driver training and registry.

Seed investments for operationalising the off board

revenue stream and general infrastructure mobilization.

Facilitating above with changes in regulatory regime or

inter agency coordination where necessary.


Delhi Transit Implications for Bus Owners

Investment in fleet and associated equipment.

Restructure the financing mechanism.

Formation of companies or joining hands with corporate

players.

Moving away from individual ownership and “competition for

passengers” to corporate ownership and “competition for

market”.

Each company will have to meet performance standards,

contractual obligations, technical parameters, technological

requirements of tracking and monitoring of individual buses

and the business prospects & risks.

Migration from individual operational flexibility to synergistic

management in a larger framework.


Delhi Transit Net System Outcomes

Progressively replace the existing blue line scheme.

Independent companies to provide services.

Clustering of routes for operational synergy and competition

reduction.

Automated fare collection system.

Automated monitoring of performance monitoring adherence

to standards relating to safety, punctuality, vehicle condition

and customer services.

Certified and registered drivers.


Delhi Transit

Discussion on RFQ – Cluster 1

L E - 1


Delhi TransitCluster 1 - Details

Total number of Proposed Routes -- 32

Total number of estimated buses

– For DTC – 330 – 340 buses

– For DIMTS – 220 – 230 buses

Total estimated scheduled km / day operation – 53,000 kms


Delhi Transit


Delhi Transit Current Status – Cluster 1

Study for feasibility of the scheme

Cabinet approved

the Scheme

RFQ document

for Cluster 1 launched

RFP document

will be launched

Concession agreement

between all 3 parties

COMPLETED


Delhi Transit Schedule Of Qualification Process

S. No. Event Description Indicative Dates

1. Pre-application meet March 24, 2008

2. Last Date for receiving queries April 07, 2008

3. DIMTS‟s response to queries latest by April 14, 2008

4. Application Due Date submission April 25, 2008 upto 1700 hrs


Delhi Transit

Only four types of applicants are eligible for participating at the qualification stage, which are:

A Business Entity

A private or public company registered under the companies Act,

1956.

Type 1

Type 2 A Co-operative society

A co-operative society of Scheduled Castes (SC) or Scheduled

Tribes (ST) registered in Delhi under Delhi Co-operative Societies

Act, 2003 on or before Application Due Date.

All members should belong to either SC and/or ST.

Eligibility Criteria


Delhi TransitEligibility Criteria

Type 3

Type 4

A Business Entity promoted by stage carriage bus

operators

The shareholders, holding a minimum of twenty-five (25) and a

maximum of thirty-five (35) Permits issued by the State Transport

Authority, Delhi valid on March 31, 2007.

Shareholders commit to hold a minimum equity stake of 51% in the

aggregate shareholding of the business entity at least for 10 years.

Consortium

A combination of a maximum of five members, comprising

One Lead Member who is a Type 1/ Type 2 entity.

Four other members who are Type 1/ Type 2/ Partnership

Firm/ registered Co-operative Society/ individual entity.


Delhi Transit Evaluation Criteria

The Applicant‟s competence and capability is proposed to be

established on two parameters:

Operational

Experience

Only, the Applicant, who meets the evaluation criteria, can

submit its Proposal for the Project.

Financial

Capability


Delhi TransitEvaluation Criteria – Operational Experience

Contd…

Category Measurement Parameter Experience Weight

Category 1 Stage Carriage (e.g. bus/ mini bus/ Rural Transport Vehicle (RTV)) operation with requisite valid permits to operate in India.

1.00

Category 2 Contract Carriage (e.g. bus/ mini bus/ RTV/ cabs/ taxi/ van/ jeep) operation with requisite valid permits to operate in India.

0.80

Category 3 Stage/ Contract Carriage with requisite valid Permits issued by appropriate authority from outside India under equivalent law.

0.80

Eligible Operational Experience has been classified in three (3)

categories, each carrying a different weight-age


Delhi Transit Calculation of Operational Experience Score

Applicant’s experience shall be measured and stated in terms of

a score

Number of Vehicles * Experience Weight * PCU Factor of the

vehicle * Number of months of operations

12

XXX PCU Years =

An operator who will achieve an Operational Experience of 300

PCU Year would be deemed to meet the experience criterion for

qualification.


Delhi Transit

Operational experience shall be considered in terms of Passenger Car Unit

(PCU) Years after April 1, 2004 and upto December 31, 2007.

Based on Category of experience, relative Experience weights shall be

assigned as set out in the following table.

PCU Factor is assign on the basis of size of the vehicle:

Type PCU Factor

Bus 3.00

Mini Bus 1.50

RTV 1.50

Car/ Cabs 1.00

Taxi/ Van/ Jeep 1.00

In case to Type 2 or Type 4 Applicants, experience of all members shall be

considered for the purpose of evaluation.

In case of Type 3 Applicants, Applicants are required to provide proof of

permits valid as on March 31, 2007.

Calculation of Operational Experience Score


Delhi Transit Sample Calculation Table

Type No of

vehicles with Permit

PCU Factor for

the vehicle

Experience Weight

No of Months in Operation (April

1st 2004 to Dec. 31, 2007)

Total PCU Years (“Operational Experience”)

1 2 3 4 5 6 = (2*3*4*5)/12

Category 1 Bus 35 3.00 1.00 24 210.00Mini Bus 10 1.50 1.00 20 25.00Category 2Bus 10 3.00 0.80 12 24.00Mini Bus 5 1.50 0.80 8 4.00Cab 50 1.00 0.80 12 33.33Taxi 10 1.00 0.80 18 6.67Van 2 1.00 0.80 5 0.67Jeep 1 1.00 0.80 6 0.40RTV 1 1.50 0.80 3 0.30Operational Experience (Sum of Total PCU Years Experience) 304.37


Delhi Transit Evaluation Criteria – Financial Capability

Type of Applicant

Financial Capability Criteria

Type 1 Applicant

Net worth of the Applicant as at the end of the last financialyear shall be at least equal to Rs. 6 Crores

or

The aggregate Net Cash Accruals of the Applicant for the lasttwo financial years shall be at least equal to Rs. 6 Crores

Type 2 Applicant

Net worth of the Applicant as at the end of the last financialyear shall be at least equal to Rs. 3 Crores along with anundertaking to increase the Net Worth to atleast Rs. 6 Crores

Or

The aggregate Net Cash Accruals of the Applicant for the lasttwo financial years shall be at least equal to Rs. 6 Crores

The Applicant should meet any one of the following Financial

Capability Criteria:


Delhi Transit

Type of Applicant

Financial Capability Criteria

Type 3 Applicant

The operators can formed a special purpose company (SPC)with an initial capital of Rs. 5 Lacs.

AND

The Applicant need to submit an undertaking, in form ofAppendix 9, committing that the authorised capital of the SPCwill increase to Rs. 6 Crores and the owner will subscribe thesame.

Type 4 Applicant

Net worth of the Lead Member of the consortium as at the endfor the last two financial years shall be at least to Rs. 6 Crores

OR

The aggregate Net Cash Accruals of the Lead Members of theConsortium for the last two financial years shall be at least equalto Rs. 6 Crores

Evaluation Criteria – Financial Capability


Delhi Transit

The application must be accompanied by the audited annual

financial statements of the Applicants for the last two years.

If the annual accounts for the latest financial year are not

audited. The Applicant may provide the unaudited annual

accounts, giving an undertaking to that effect and the

statutory auditor shall certify the same.

In Case of Type 4 Applicant (Consortium), the financial

capability of the Lead Member should be equal to 100% of the

Financial Capability Criteria.

The Lead Member should hold 51% stake and all members

of the consortium should hold minimum 5% stake of SPC.

Evaluation Criteria – Financial Capability


Delhi Transit

Net Cash Accruals = (Profit After Tax + Depreciation + Non cash

Expenses)

Net Worth = (Subscribed and Paid-up Capital fund + Reserves +

Share Allotment Money Already Received + Preference Shares

(including Redeemable) + Convertible Debentures but excluding

Warrants - (Revaluation reserves + Miscellaneous expenditure not

written off)

The financial year would be the same as followed by the Applicant for

its annual report. Say, Year 1 will be the financial year 2007-08. Year 2

shall be the year immediately preceding Year 1.

The Applicant shall provide the audited annual financial statements

as required for this RFQ Document. Failure to do so would be

considered as a non-responsive bid

Financial Capability - Financial Terms/ Definition


Delhi Transit

T E

D T A I


Delhi Transit Bus Specifications

Buses will have a mix of specifications (based on the nature of

the route, road conditions and the traffic patterns) such as low

floor, semi low floor and standard buses.

All buses will be equipped with GPS tracking system,

automated devices to validate off-board tickets, devices to issue

tickets and devices to record identity of staff for increased

safety.


Delhi TransitFares and Revenue Streams

The operators will be compensated through following revenue

streams:

Fare box collection as per regulatory provisions.

Off board revenue from sales of tickets and advertising on

the buses etc. as per the bid criterion.

Fiscal Incentives and Disincentives operationalised

through the per km. payment.

Operators will be paid, along with incentives and disincentives,

from an escrow account jointly managed by the operator and

the concession manager.


Delhi TransitBid Criterion

The bid criterion will be a per kilometer/ passenger

kilometer (yet to be finalized) cost payable to the operators

by the concession manager from off-board revenue

(generated from off board tickets, advertising revenue and

operational penalties).

This payment will be in addition to the fare box revenue

that will be retained by the operator.


Delhi TransitL1 - Least Present Value Revenue (LPVR)

To facilitate a possible foreclosure of the concession from

any operational eventuality or structural reorganization,

operators may be required to quote a Least Present Value

Revenue (LPVR) figure at a standard discount rate that

will be kept in a sealed cover during the pendency of the

concession.


Delhi Transit

38

Appendix Detail

Appendix Detail Type 1 Type 2 Type 3

Type 4

Lead Member

Member 1

Member 2

Member 3

Member 4

1 Letter of Application

2 Power of Attorney

3 Power of Attorney (Single)

4 Details of Applicant

5 Financial Capability

6 Experience

Form 6A (Permit Details)

Form 6B

7 Affidavit

8 MOU (Single)

9 Undertaking by Type 3

10 Undertaking by Type 3


Delhi Transit

Thank You !

“Private Stage Carriage Corporatisation in Delhi” · 1 Pre 1950 stage carriage operation...

Documents

Transcript of “Private Stage Carriage Corporatisation in Delhi” · 1 Pre 1950 stage carriage operation...