Logistics firm Gati Ltd plans to be a Rs 3,000 cr company in 3 years

Gati Limited, a subsidiary of the Allcargo group, aims to grow to Rs 3,000 crore in three years, thanks to key accounts, micro, small and medium enterprises (MSMEs), and business-to-business (B2B) retail. Chief Executive Officer Pirojshaw Sarkari told the media that to meet the goal, it has identified three areas, including talent acquisition and infrastructure development. Gati became distracted in the past 5-7 years as it tried its hand at other businesses rather than focusing on express logistics, according to Sarkari, before coming under the ownership of Allcargo Group. Gati's promoter and single largest shareholder, Allcargo, owns 47% of the company, followed by KWE, which owns about 3.5%. Gati-Kintetsu Express Private Ltd (Gati-KWE) is a joint venture (JV) between Gati and Kintetsu World Express (KWE), with Gati owning 70% of the company and KWE owning 30%. Gati covers 735 of the country's 739 districts and more than 19,800 PIN codes, thanks to a strong presence across Asia and a nationwide network. Gati-KWE opened its largest state-of-the-art transhipment centre at the Allcargo Logistics Park in Farukhnagar, Gurugram (Haryana), earlier this week, with the ability to process short-haul cargo deliveries in the north and long-haul cargo movements across India. It also announced plans to build seven more such hubs in the next 15 months, including in Mumbai, Bengaluru, Hyderabad, Nagpur, and Indore, and 12 more in the next three years. The company's revenue for the fiscal year ended March 31, 2022, was Rs 1,324 crore, down from Rs 1,714 crore the previous year. According to the company, factors such as pandemic-related disruptions, changing customer behaviour and consumption patterns, as well as the company's strategic decisions to focus on businesses that are its core expertise and exit non-core ones, have all had an impact on revenue numbers in the short term. Key accounts, according to Sarkari, provide a company with volume despite low yields because they are large customers who demand low pricing, and they account for up to 50% of any logistics structure. Automotive spare parts, which is auto aftermarket, and pharmaceutical companies, which use both air and surface express, as well as the garment segments, are big customers for a company like Gati. Image Source