Mumbai: Come 15 October, G.R. Gopinath, pioneer of low-fare aviation in India, will start the first phase of expansion for his four-month-old air cargo venture, Deccan 360, by entering into the small parcels business with Nagpur as a hub.
From that date, Gopinath’s Deccan Cargo and Express Logistics Pvt. Ltd, which runs Deccan 360, will fly three large Airbus A310 planes and seven smaller ATR planes to connect 17 small and big Indian cities as well as international destinations such as Dubai and Hong Kong.
Expansion mode: Gopinath says Deccan Cargo is focusing on developing end-to-end logistics infrastructure. Ramesh Pathania / Mint
On Tuesday, Gopinath took delivery of a third A310 plane, which will be used to connect international routes from New Delhi and Chennai. “We will be taking delivery of seven ATR planes by (the) last week of September,” Deccan Cargo’s managing director Gopinath said in an interview to
Mint on Tuesday.
Gopinath, who had launched India’s first low-fare airline Deccan Aviation Ltd, which ran Air Deccan, launched Deccan Cargo in May with one A310 plane for its international general cargo business.
Gopinath said Deccan Cargo is not looking to raise funds from the market immediately and is focusing on developing end-to-end logistics infrastructure.
Last year, prior to the launch of the air cargo firm, he had asked Mumbai-based investment bank Edelweiss Capital Ltd to seek private-equity investors.
The former army captain has since put that plan on the back burner and is now putting his own money into the cargo venture. He said he will consider fund-raising options when market conditions improve.
“Now, I am looking at entering the express logistics segment (small parcels business). We have selected at least 75 franchisees across the country to facilitate this,” Gopinath said. “In mid-October, for the first time in the country, at least 17 tier-II (or smaller) cities would be connected by ATR planes.”
Deccan Cargo is developing a huge warehouse at Nagpur to create a multi-modal logistics hub that will aggregate, distribute and redistribute cargo to and from international and domestic locations.
“The longer game plan is the bigger Airbus planes would be plugged into (the) Nagpur hub to have a direct connection to international locations. This should happen by November,” Gopinath said.
Industry players are sceptical about the venture as several other firms that had lined up plans for air cargo businesses in India have been backing out even before the economic slowdown began.
Chennai-based Crescent Air Cargo Services Pvt. Ltd and the country’s second largest courier company, First Flight Couriers Ltd, temporarily suspended operations in 2007 blaming the high cost of using smaller planes on long routes.