FM Logistic is looking to double its warehousing space to 1.2 crore sq ft in the next four years from the current 60 lakh sq ft. It plans to set up multi-customer facilities in Bengaluru, Delhi, Kolkata, Hyderabad and Chennai in the next 2-3 years.
The 3PL service provider is anticipating the demand for warehousing facilities and fulfilment centres to increase in the aftermath of the pandemic. It has already announced its plans to add 40 lakh sq ft warehousing space in the next three years that will take its total space to 1 crore sq ft, with another 20 lakh sq ft on top of it.
FM Logistic’s MD and CEO Alexandre Amine Soufiani said, “We expect sales to return to pre-COVID levels by March 2021 as 90 per cent of the business has already recovered by December.”
“With plans to set up Grade A facilities in all metro cities and ‘dynamic economic areas’, especially multi-customer units, and focus on urban logistics, FM Logistic looks to attain leadership position in the sector,” he said.
Soufiani said the company has added a total of 10 lakh sq ft space in the last six months, all for multi-customers facilities, including omni-channel, pharma, e-groceries, FMCG, food, industrial, among others.
“The omni-channel strategy has now become a central strategy for most of the companies which are into retail, FMCG, groceries and pharma, among others, and has given a big opportunity to third party logistics providers. However, in the wake of pandemic, safety, compliance and quality have become a must and players in segments such as FMCG, pharma and e-commerce are pushing more and more for A grade warehousing facilities,” he added.
“We could realise a quarter of our 40 lakh sq ft. There is another 10 lakh sq ft of space that we have also signed of which 4 lakh sq ft we are going to get this month, another 4 lakh sq ft we will be getting in April/May next year,” Soufiani said.
FM Logistic signed five new contracts during the pandemic period. While omni-channel and auto segment account for 25 per cent of the company’s overall business, pharma accounts for 10 per cent of business and the rest comes from other segments.
“We expect revenue from omni-channel to grow to 40 per cent in the next 3-4 years as this is going to be the future. Auto revenue we expect to stay at the same level. However, we are also looking to double revenue from pharma to 200 per cent in the 3-4 years period as against 10 per cent at present,” Soufiani said.
“Overall, we are looking at 35-40 per cent year-on-year growth in our revenue, going forward,” he added.
In March 2019, FM Logistic had outlined its plans to invest USD 150 million over the next five years to set up new warehouses in India, with focus on multi-client warehouses.
The company is soon expected to commence operations at its Bhiwandi facility in Maharashtra, which is spread in 4 lakh sq ft space with a part of it dedicated for pharma clients.
The upcoming state-of-the art warehousing facility at Jhajjar in Haryana will also be operational in the second quarter of 2021.
Earlier this month, FM Logistic had signed a strategic partnership with Welspun Logistic Park to develop 9 lakh sq feet space in Bhiwandi in the next 3 years.
According to Soufiani, the company has already consumed Rs 200 crore of its Rs 1,200 crore investment plan announced in March last year. “The pending Rs 1,000 crore is still available for creating state-of the art Grade A facilities in all the metro cities and the dynamic economic areas of the country. Besides, it will also be used for intra-city logistics facilities, IT systems as well as automation,” he said.
Though full-automation in warehouses is not feasible in the country due to certain barriers, the company said it is going to enable provisions for automation in areas such as loading/uploading, inventory stock taking, among others.