The Hindu Business Line : Safexpress to focus on infrastructure expansion

Snapshot
Expansion to be funded through internal accruals.
In Chennai, it has invested Rs 35 crore to set up a 3 lakh-sq-ft logistics park.
The company places order for 380 trucks.

Our Bureau

Chennai, Sept. 20 Logistics services provider Safexpress Pvt Ltd will invest around Rs 1,000 crore in the next five years on infrastructure expansion, including setting up warehouses across the country. It will also lease three aircraft to expand its air cargo operations, according to the company’s Chairman and Managing Director, Mr Pawan Jain.

The company will fund its expansion through internal accruals. Mr Jain said the company has a strong bottom line (around 25 per cent net profit) and cash reserves.

Safexpress plans to take on lease three Boeing 737 cargo aircraft and provide air cargo services starting with 5 Indian cities, Mr Jain said, but did not identify them.

Turnover

The company hopes to double its turnover to Rs 1,000 crore by 2010, he told reporters on the sidelines of CII Logistics 2007. The privately-held company has been growing at 35 per cent and posted a turnover of Rs 450 crore in 2006-07. It expects a similar growth this year, Mr Jain said.

In three years, Safexpress will add 7 million sq ft of space to its existing 3 million sq ft. It will set up logistics parks comprising warehouses, vendor management, raw material management, finished products storages, and also distribute consignments. These parks will come up in 32 locations across the country, he said.

Chennai park

In Chennai, the company has invested Rs 35 crore to set up a 3 lakh sq ft logistics park on the Chennai-Bangalore National Highway. The new facility will be the second largest facility for the company — after its 8 lakh sq ft facility in Mumbai — and will be inaugurated in December, he said.

Safexpress already has a 80,000 sq ft warehouse facility in Chennai. The new facility will be for customers like Nokia (for distributing their mobile handsets) and Dell.

The company has also placed an order for 380 trucks to add to its current fleet of 3,000 vehicles. It does not own the vehicles, but hires them through its network of 59 vendors, he said.

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