Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

TZ Limited Winning Battle Of Online Parcel Delivery Lockers

Mark Bouris' TZ Limited (ASX:TZL) has added more high profile retailers to its A.D.A.M. online parcel delivery network, signing up Nike, Tony Bianco shoes and Pamper Hamper Gifts.

Why the need for the lockers? A significant number of deliveries in Australia fails because the customer is not home to receive the parcel.

TZ's ADAM parcel lockers are designed as an alternative to allow pick-ups using a secure code sent to the customer, rolling out in venues such as shopping centres, convenience stores, parking stations and petrol stations.

One of TZ's trump cards is its partnership with Temando, which boasts relationships with over 30,000 retailers around the world that use its applications for direct online purchases between 200 different delivery services.

For TZ, it is carrier agnostic, its lockers will accept deliveries from any courier.

It is sprinting to increase the number of venues and locations of its A.D.A.M. parcel lockers in sites around Australia that offer an alternative to Australia Post's limited offering.

The flagship venue to date is the MLC Centre in Sydney which boasts among the highest foot traffic of shoppers.

Interestingly, if you take a stroll around Westfield Shopping Centre at Chatswood in Sydney, an ADAM locker has been installed for buiness last Monday.

Analysis

We believe there will be further ADAM locker roll-outs including more Westfield Shopping Centre venues.

Taking on an encumbent such as Australia Post is never easy, but TZ is not only gaining but pulling away from its larger competitor because of its adroitness in ramp up and ability to accept deliveries from all couriers.

The prize for TZ is significant as it looks to land a piece of the lucrative business-to-customer on-line logistics market that is growing exponentially.

Although unofficial metrics, agreements and partnerships struck to date for TZ could account for as much as 60% of the parcel deliveries in Australia.

TZ's current market valuation of $25 million for the group is against the intrinsic value inherent in the A.D.A.M. business as well as March quarter revenues of $6.3 million for TZ (annualised rate of $25.2 million).

On our estimates, TZ Limited is valued between $0.16-$0.20 within the next 6-9 months.

Proactive Investors Australia is the market leader in producing news, articles and research reports on ASX "Small and Mid-cap" stocks with distribution in Australia, UK, North America and Hong Kong / China.