Investment Memorendum Euclid for Aeroflot

Euclid Limited

Investment Memorandum For GSA of Euclid Limited Khaled Hasan

Investment Memorandum

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Chittagong is a metropolis on the move, with a character very different from that of any other city in Bangladesh. Its vibrant cultural diversity, rich British heritage and spectacular scenery make it one of the most attractive cities in the world.

Having developed into a truly exceptional place in which to live and work, South Asia’s Major Port City original contributor of Silk route is well positioned for a rapidly changing global environment.

• A world-class business environment with: - a skilled and competent workforce - an internationally respected research base - highly competitive factor costs - a wide range of professional business support services - excellent infrastructure

QC is a prominent business house headquartered in Chittagong having a business track record of more than four decades in shipping, trading, outsourcing and government supply business. Qc Logistics started its operation more than a decade ago as one of the full fledged logistics company having potentiality assist in total logistical needs of corporate houses, containerized shipping, and project cargo, shipment of oversized goods, special cargos and assisting logistics and third party logistics in Bangladesh more than a decade ago. An airline GSA is a third party - usually a travel agent - that provides marketing and sales services to an airline under the airline's brand, usually in countries where the airline does not have service to (or has very limited service to. The GSA brings a local infrastructure, market knowledge and sales processes and is able to provide sales and marketing assistance to an airline without the airline having to incur the expense to build up their own staff in the country. Consider a GSA outsourced sales & marketing assistance. But we Euclid Limited do differ with the basic idea since we would like to add our tailor made touch of excellence service and care both on and off flyers who will take our service. Our service will start before they even wish to fly with us. Channeling their interest towards flying with us,



attracting them with the unique packaged service provocation, providing best value for what they are paying will be our motto. In this case we do differ with the other GSA service providers and hence chosen your airlines as our proposed partner for starting of our forthcoming GSA Service.

Apart from shipping business to have a foothold in the aviation industry and ever growing market of air travel QC Logistics formed its offshoot Euclid Limited specifically to enter and tap into the airline industry by representing different airlines GSA in Bangladesh and also selling destination holidays as a part. In recent years at 2013 the three International Airports have handled more than 550,000 Tons of Cargo and 10 Millions Passengers in over 38 cities around the world. The amount of air travel is growing at a rate of 12.5% each year and Cargo at a rate of 14~15% a year. By keeping this in mind any inception of new GSA of dominant airlines connecting existing cities or new cities where potential passenger volume is there shall be very lucrative for business. By assessing this potentiality we have invested on this sector by creating an individual organization specifically for airline business and GSA with an intention to run our own fleet of airlines in near future both in domestic and international market. At present we have our own office spaces of 300 square meters fully furnished in Chittagong and 200 square meters in Dhaka at most prime real estate location. We are also in line to acquire another place for Euclid Ltd operations in Sylhet.

General Sales Agents (GSAs) play a very vital role in the growth and development of a country’s civil aviation and is the backbone of the industry, the main-stay needed for the industry to flourish. Before venturing in any new market, instead of opening their own offices, airlines appoint a GSA. This is the most cost effective method for them. The markets are new to them and they need an expert to guide them on, hence the GSA. Because of his understanding of the market it is his responsibility to evolve market strategies to promote sales and achieve targets set by the airlines.

It promotes sales through IATA agents, non-IATA agents, corporate houses and by other marketing and commercial activities either evolved by itself and also under the guidance of the airline.



As a GSA is thus supposed to be a man of many parts with mastery in several skills besides marketing. We have the ability to be a good PR a diversified marketer and also have good contacts in Department Of Civil Aviation and Tourism.

To be an effective GSA, we have developed such qualities within our members such as credibility, tact, friendliness, sociability, patience and tolerance. He has to be a winner with positive attitude and outlook. At present Euclid Ltd has more than 150 personnel working in different position handling,

Why Bangladesh is potential Airlines Business Hub

• Access to world markets via preferential trade agreements between South Asia and the other major markets such as Europe, facilitated by the world trade agreement, and the United States,

• A diverse and balanced economy as reflected by the wide range of value-adding manufacturing and service-oriented industries.

• Cost-competitive opportunities in both the metropolitan and rural areas.

• A low cost-of-living index – rated second by the World Competitiveness Yearbook.

• An excellent quality of life – an open cosmopolitan society, a Mediterranean- type climate and an unspoilt natural environment.

ComparativeStudy Item Dhaka Airport ChittagongAirportTurnaroundtime 1 hrs 15 minutes + 30 minutes+GroundHandlingCost USD 1200~2400 plus

30% extra on off hoursand extra time groundingoftheplane

USD 1200 plus 30% extraonoffhoursandextratime grounding of theplane

Ground Handling ofBaggage

Semi‐Automated FullyAutomated

Ticket Checking &BoardingofPassengers

Takes longer time as theAirport handleshourly4to5flightsdaily

Takes shorter time asdaily in total 20 flightshandled



Individual Booth forBoarding & passengerHandling

Scarce of resource willforce to share booth withairways

Individual Booth isavailable with scope onsightofficeforairways

Embarkation &Disembarkation

Sometime off terminal inrunway passengers arecarriedbyapronbus

Directly to the mainterminal via automatedboarding bridge made byFrance which is bestsuitable for Airbuspassengerhandling

FuelCost Standard rate 10 centlesser atpresentpriceinperliter

Distancefrommaincity 20 km 14 kmFlightFrequency Higher LesserAirport Facility andEquipment

Old Newer as it is newlyopened Airport

Flight SlotAvailable forPassengers

Limited Anytimeoftheday

FuelSavings Less MoreTicketPrice Expensive for longer

distanceLesser for shorterdistance

Terminals, airlines and destinations The airport consists of three major terminals, T1 and T2 for international flights and a third terminal (known as Domestic Terminal) for domestic flights. The arrivals deck is the ground floor and the upper floor is the departures hall. A VIP terminal is built only about 200 meters from the main gate and is only used occasionally. A third international terminal will be built in the future. Passenger

Airlines Destinations

Air Arabia Ras al Khaimah (begins 6 May 2014),[26] Sharjah

Air India Delhi, Kolkata

Bangkok Airways

Bangkok-Suvarnabhumi

Biman Abu Dhabi, Bangkok-




Bangladesh Airlines

Suvarnabhumi, Chittagong, Dammam, Delhi, Doha, Dubai-International, Frankfurt, Guwahati (begins 1 July 2014),[27] Hong Kong, Jeddah, Kathmandu, Kolkata, Kuala Lumpur, Kuwait, London-Heathrow, Muscat, Riyadh,Rome-Fiumicino, Singapore, Sylhet, Yangon

China Eastern Airlines

Kunming

China Southern Airlines

Guangzhou

Dragonair Hong Kong

Druk Air Paro, Kolkata, Bangkok-Suvarnabhumi

Emirates Dubai-International

Etihad Airways

Abu Dhabi

Flydubai Dubai-International

Jet Airways Delhi, Kolkata, Mumbai

Kuwait Airways

Kuwait

Malaysia Airlines

Kuala Lumpur

Maldivian Chennai, Malé

Malindo Air Kuala Lumpur

Mihin Lanka Colombo

NovoAir Chittagong, Cox's Bazar, Jessore, Sylhet

Pakistan International Airlines

Karachi

Qatar Airways

Doha




Regent Airways

Bangkok-Suvarnabhumi, Chittagong, Cox's Bazar, Jessore, Kolkata, Kuala Lumpur, Singapore, Sylhet

Saudia Dammam, Jeddah, Medina, Riyadh

Singapore Airlines

Singapore

Thai Airways International

Bangkok-Suvarnabhumi

Tiger Airways

Singapore

Turkish Airlines

Istanbul-Atatürk

United Airways

Barisal, Chittagong, Cox's Bazar, Dubai-International, Ishwardi, Jeddah, Jessore, Kathmandu, Kolkata, Kuala Lumpur,Muscat, Rajshahi, Saidpur, Sylhet

Cargo and freight


British Airways World Cargo

Chennai, Frankfurt, London-Stansted, Zaragoza (all end 30 April 2014)

Cathay Pacific Cargo Hanoi, Hong Kong

China Cargo Airlines Chongqing, Shanghai-Pudong

China Southern Airlines Cargo

Guangzhou

Emirates SkyCargo

Dubai-International (ends 1 May 2014), Dubai-Al Maktoum (begins 1 May 2014)

Etihad Cargo operated by Atlas Air and Martinair Cargo

Abu Dhabi, Hong Kong

Hong Kong Airlines Cargo

Hong Kong

Korean Air Cargo Hanoi, Seoul-Incheon

Lufthansa Cargo Frankfurt, Delhi, Mumbai

Qatar Airways Cargo Doha-Hamad




Saudia Cargo Dammam

Singapore Airlines Cargo

Singapore

Turkish Airlines Cargo Bishkek, Istanbul-Ataturk

Uzbekistan Airways Cargo

Tashkent

At any given time Euclid Limited has the distinct Competency to start the flight operation of the Aeroflot within 30 days or less period of time. Presently the clear scenario reflects that Aeroflot will face stiff competition from other airlines if it is operated from Dhaka Airport, although we do have already developed all the necessary infrastructure and supporting service to operate from Dhaka. Whereas if operated from Chittagong Airport any Airways will have share of an untapped market which has been neglected and never looked after by major airlines. The question might arise why from Chittagong? As Chittagong is the main business hub of Bangladesh most of the business passengers are from Chittagong who visit on route to Bangkok towards other major Asian , Middle eastern destination like Singapore, Malaysia, Indonesia, Korea, Taiwan, Myanmar, China , Japan, UAE, Oman, Kuwait, UK, USA and also to Australia. We have prepared ourselves with the view above point to operate your airlines primarily from Chittagong also keeping the option open to operate simultaneously from Sylhet and Dhaka. In this case, the passenger from Dhaka that we are interested to tap into will be first redirected to Chittagong via as per buyer’s preference in via air, by road or by railway. We have already ongoing negotiation and mutually agreed with local airways Regent, United, Novo Air to carry the passengers to Chittagong Airport, or passengers according to their taste can choose Luxury 27 seated VIP Limousine AC Bus via road or by AC Chair coach in Bangladesh railway.



Mainly passengers most in this case will prefer to fly from Chittagong as the ticket price of Chittagong to other destination will be cheaper by USD 100 and carrying them back and forth via bus or train will cost around USD 30 with refreshments, where all they have to endure is 6+6 hrs travel time via road or train from Dhaka to Chittagong and Chittagong to Dhaka. Beside that the total air cargo which includes food items, fruits, vegetables, mail, readymade garments, textiles, fish and sea food are around 75,000MT and the volume increasing 10% every year. Since your airways has already strong foothold in Middle east, Asia Minor , Europe and planning for expansion we can easily make Chittagong your Transit hub for future operation. A recent multi nation agreement on transit by Asian highway has been done by this Bangladesh and Chittagong sea port will be act as the main transit hub sea port for countries like Myanmar, South Western Part of India, Nepal, Bhutan and China. After the Transit begins in January 2011 onwards the frequency of ships in sea port will increase and a great number of sailors will have a option t fly from Chittagong to their home country via Bangkok Airways. After the road linkage the people of South Western India adjacent to Chittagong vision, Bhutan and Nepal can be channeled to travel via roadway towards Chittagong and take onwards flight via Bangkok airways. We have several office spaces in prime locations of all the major cities of Bangladesh. We are also planning to provide fully AC Shuttle Bus service from our Sales outlet to Airport in Dhaka and Chittagong as both the airport is far away from city and this will help both incoming and outgoing passengers to commute in the city with ease and comfort. Also to consider the travel market we would be very pleased to offer your airways and alliances travel, tour, health tourism packages for the local consumer of Bangladesh



To us service comes first and if customer satisfaction is achieved with tailor made service augmented facility the sales will rapidly increase. The marketing policy will strictly revolve around service and customer satisfaction with unique pricing strategy of your airlines. To increase the sales we have full cooperation with ATAB Travel Agents of Bangladesh Agency and they have confirmed us to provide sales of tickets through their members all over Bangladesh. For sales and customer compliance along with CRM a dedicated call center will be established. The travel Agents will book the tickets via online page of Airways Bangladesh website. Moreover the customer can directly book the ticket from online. We have arranged for payment with the major foreign banks operating in Bangladesh like HSBC and Standard Chartered Bank in accordance with Bangladesh Foreign Financial Transaction policy and Banking law to pay your Airways in every alternate day or in every Week. After signing of GS Agreement the papers to pave necessary money transfer through banking channel will be done after payment of local taxes in Bangladesh. Already to establish and create market for your Airways necessary advertisement and marketing plan has been under ways and negotiation with print and tele media has been done. An efficient sales force of marketers will handle the prospective corporate sales. Since our parent group is in the market for more than 75 years as a leading conglomerate with corporate reach to many institutions, we will use that reach with our efficient marketers to establish sales chain for corporate bodies I Bangladesh. Relative accommodation service for passengers and crews in case of any uneven situation or delay in flight has been taken consideration also. For that several three and four star hotels are taken under contract to receive crews and passengers at any given time in Dhaka and Chittagong.



Economic Strength of Euclid Limited As of Year 2014 Particulars Cost in USD Written Down Value USD Office Floor of 4000 Sqft at Chittagong

535,000 535,000

Leased office Floor at Dhaka 125,000 125,000 Office Vehicle CTG 60,000 60,000 Office Vehicle Dhaka 30,000 30,000 Office decoration & Equipments at Chittagong

55,000 55,000

Office decoration & Equipments at Dhaka

25,000 25,000

Ground handling and boarding communication equipment at Dhaka & CTG

50,000 50,000

Marketing & PR Fund 75,000 75,000 Operating Fund 125,000 125,000 Salary & Expenditure 1,000,000 1,000,000 Total Invested Amount in GSA Business as of Today

2,080,000 2,080,000

As this is the introductory year for Euclid in GSA business and we presently working with only one GSA which is Golden Myanmar Airlines (GMA) forecasting of NPV< IRR is absent due to we haven’t completed an accounting year cycle. Euclid Limited at present taken every possible steps and considered every loophole in the market to establish Aeroflot as potential airlines in Bangladesh. Now we are waiting for your decision to start our GSA Service



for you. We have clearly shown our strength in operating from all the international airports of Bangladesh. But to have a maximum profit mix running weekly 8~10 flights towards Europe, America and Fareast must be originated from different International airports of Bangladesh based on preference of air traveler cue.



Investment Memorendum Euclid for Aeroflot

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