BackGati looking to buy out JV partner Kintetsu
The gross margin expansion remains on track. We have been able to deliver positive bottom line for the second consecutive quarter and are optimistic of increasing the margins going forward, says Pirojshaw Sarkari, chief executive officer, Gati Ltd
PremiumMUMBAI : Listed logistics services provider Gati Ltd., an Allcargo Group company, has been on a turnaround for the last 12 months. Sequentially, for the quarter ended September 30, 2022, the company reported a total income of ₹442.60 as against ₹436.72 crore it earned in the previous quarter, its filings showed.
With its increased emphasis on the business to business or B2B segment, the company is looking at buying out its joint venture partner Kintetsu in Gati-Kintetsu Express Private Limited (Gati-KWE). This is a JV where KWE holds 30% stake and Gati holds the remaining 70%.
“We are going all out and planning to buyout our partners to drive the next level of growth for the company," Pirojshaw (Phil) Sarkari, chief executive officer, Gati Ltd, told Mint.
Allcargo Logistics acquired Gati and now owns more than 50% stake in the company. Japan’s Kintetsu World Express (KWE) owns around 3.5% shares in the company.
KWE India is the Indian subsidiary of Kintetsu World Express (KWE), which is part of the Kintetsu Group, a global conglomerate consisting of 130 affiliated companies.
Headquartered in Bangalore, KWE India offers international air freight forwarding, international sea freight forwarding, customs handling, import and export of goods, warehousing, and last-mile delivery to both B2B and B2C businesses across India.
Founded in 1989, Gati has presence across Asia, including a nationwide network that covers 99% of the country's districts.
Key business verticals of Gati include express distribution, air freight, ecommerce, first and last mile logistics, etc. Gati also offers B2C services like Laabh, Bike Express, Student Express, and others.
For Gati, its express business revenues for H1FY23 stood at ₹734 crore registering a growth of 29%. “The gross margin expansion remains on track. We have been able to deliver positive bottom line for the second consecutive quarter and are optimistic of increasing the margins going forward. This growth and efficiency are a result of conscious efforts taken to increase our market share, reduce costs and increasing operational efficiencies across the organisation," Sarkari said.
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