Mumbai: Fung Capital will invest $ 30 million in Future Group logistics and supply chain vertical.
Future Group proposes to change the name of its subsidiary, Future Logistic Solutions Ltd. to Future Supply Chain Solutions and will divest up to 26% of its stake. The present CEO of Future Logistic Solutions Ltd’s Anshuman Singh will be the managing director of Future Supply Chain Solutions.
Fung Capital is the private equity investment arm of the families of Victor Fung and William Fung, the controlling shareholders of the Li & Fung Group. This investment is unrelated to any of the Li & Fung Group companies.
Fung Capital, will invest around $30 million in the logistics and supply chain company, which will be used for the enhancement of the logistics infrastructure of the company, strengthening of the technology platforms and expansion of the supply chain network of the company.
Presently, the company services over 1100 retail outlets across India, managing more than 2.6 million SKU’s from a warehousing network spread over 3 million sq ft in 30 centres in India and a fleet of over 500 vehicles plying across the country.
“We are building a world class supply chain infrastructure for the consumption products in India which is presently very limited, despite it being a critical support required in India’s rapidly growing economy. We will be investing in physical as well as technology infrastructure that will reduce the time-to-market and cost-to-market for fashion and apparel and other consumer categories,” said Singh.
The Indian logistics market is estimated to be about $100 billion, with the share of organized players being just 6% of the total market. The logistics sector has been seeing substantial investments lately and the organized segment is expected to grow at 25-30% CAGR over the next few years. The consumption product supply chain is estimated to be around 20% of the logistics market and is at a nascent stage. Future Group’s logistics vertical hopes to capture a dominant share in this segment as a Third Party Logistics (3PL) service provider, a company statement said.
Mint first broke the story on 18 September 2008.