Safexpress plans Rs 1000 cr investment

Logistics services provider Safexpress plans to invest Rs 800-1,000 crore over the next five years in expanding its operations, on the back of a boom in manufacturing and retail activities in the country. The expansion will see the company reaching the Rs 1,000-crore turnover mark by 2010.

The company expects to fund its expansion through internal accruals and some debt as it claims to have strong bottomline and cash reserves. Privately-held Safexpress has been growing at 35 per cent, posting turnover of Rs 450 crore in 2006-07. The company expects similar growth this year as well, Pawan Jain, chairman and managing director, Safexpress, told reporters at the CII Logistics 2007 summit in Chennai on Thursday.

Safexpress intends to set up logistics parks comprising of warehouses, vendor management, raw material management, finished products storages, among others, at 32 locations across the country. Each park will come up on 25-30 acres. Around 70 per cent of land across various locations has been acquired by Safexpress' group company, which is into the realty business.

The company is also in the process of establishing a 3 lakh sq ft logistics park near Chennai on an investment of Rs 35 crore.

It already operates a 80,000-sq ft warehouse in Chennai.

Through the expansion programme, the warehousing capacity of the company is expected to be scaled up to 10 million sq ft over the next three years from the present 3 million sq ft.

Jain said the company was planning to take on lease three Boeing-737 cargo aircraft to cover five cities in India by the next financial year to strengthen its presence in the air cargo segment.

Safexpress has also placed an order for 380 trucks to add to its current fleet of 3,000. The company doesn't own the vehicles, but hires them through its network of 59 vendors.