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K.V. Kurmanath

Hyderabad , May 4

, XPS, the express cargo company from the TCI stable, would join hands with a Russian logistics major to offer inbound and outbound services to its clients.

"We hope to complete the deal in a month," Mr Chander Agarwal, Director (Global) of XPS, told Business Line.

The company had recently entered into a tie-up with the Chinese logistics group Zhenhua to extend its services to that country.

The tie-up provides for international freight, custom clearance and other logistic service for customers doing bilateral business.

On the company's global plans, he said expansion of operations would be in phases. "In the first phase, we covered the countries in the region, with a special focus on South Asia. Then we will move onto the higher orbit," he said.

"We are carrying out studies internally to understand the needs of our customers. We will design our services and expansion accordingly," he said.

Eyeing the Rs 40,000-crore Indian air cargo industry, XPS was planning to invest Rs 50 crore in its specialised air division XPS Air in the next five years.

The investment was aimed at expanding company's branch network, strengthen the infrastructure, human resources and technology upgradation. Besides, it also entered into talks with some companies that operated aircraft fleet.

"We will be exploring new markets such as Chandigarh, Lucknow and Rajkot that promises huge air cargo potential," XPS Air, which registered a turnover of Rs 30 crore during 2004-05, set its eyes on a growth rate of 25 per cent in the next five years as against the projected industry growth rate of 10 per cent.

"The Rs 40,000-crore air cargo industry is all set to witness a 20 per cent growth in volumes," he said.

The company believed that textiles, pharma, FMCG, perishables, engineering and automotive sector would drive the business.

XPS felt that the air cargo industry would further grow with more and more countries coming up with open sky policies. Elimination of quota regime in the textile sector too would boost the cargo sector.

The company registered a turnover of Rs 180 crore during 2004-05 as against Rs 150 crore in the previous year.

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