Buoyed by huge demand in the used vehicle market segment, Shriram Automall India Ltd (SAMIL) is eyeing 30-50 per cent growth rate next fiscal beginning April.
The company which is a fully-owned subsidiary of Shriram Transport Finance Company, provides a trading platform for buyers and sellers for used vehicle.
"We are eyeing 30-50 per cent year-on-year growth in the next fiscal (2014-15). We will be touching around Rs 100 crore as service charges this year. We have already become profitable now as break-even already happened," said its Chief Executive Officer, Sameer Malhotra, during an interaction.
The company generates its revenue by charging service fee in range of 3-5 per cent on an average ticket size of Rs 1.75- 2 lakh.
The company witnessed about 50,000 transactions in the previous fiscal and has crossed over 1 lakh transactions this year already, he added.
SAMIL at present has about 31 automalls across India where physical bidding for used vehicles takes place between buyers and sellers.
"In 31 locations we are already present and right now we are searching around 20 locations. Around 15-20 locations are in different stages of construction. And another 10-15 we are opening. We are looking at opening over 60 automalls within next one year," he added.
Apart from physical bidding at automalls, the company also facilitates trading in used vehicles through online bidding, private treaty and one-stop intranet kiosks.
It is present in over 80 locations across India. The company provides trading platform for commercial vehicles, farm equipment, industrial equipment, construction equipment, cars, SUVs, three-wheelers, and two-wheelers.
In physical platform process at automalls, yards have been constructed pan-India on the highways, where about 10,000 transactions takes place every month.
He said around 20 lakh customers are invited every month through advertisements in newspapers, tele-calls and SMS.
Around 500-1,000 people visit automalls everyday to inspect vehicles and see bidding process.
"From registered buyers and sellers, we take fully refundable security deposit of Rs 20,000 at atuomalls from our customers to make bidding more reliable," Malhotra said.
In the online space, the company conducts about 2,000 transactions per month.
Shriram group also provides financing facility to buyers at automall through Shriram Transport Finance.
SAMIL generates about 50 per cent of its revenue from South India and rest of India has about equal proportion in its fee income, Malhotra added.
"Our customers are banks and finance companies, dealers and manufactures of all these segments, transport users and owners, construction companies, end user individuals and brokers," he said.
