Mahindra Logistics Wants to Almost Double Within Three Years
Company targets revenue of 60 billion rupees by 2021: CEO.
(Bloomberg) -- Mahindra Logistics Ltd., a unit of India’s biggest utility vehicle maker, expects higher revenues due to consolidation in the industry spurred by the nationwide sales tax.
It’s easier for a customer to get the full benefit of the Goods and Services tax by dealing with a fewer number of vendors, said Mahindra Logistics Chief Executive Officer Pirojshaw Sarkari in an interview in Chennai last week. Customers will seek large third-party logistics players instead of a number of carrying and forwarding agents previously, he added.
“Our vision is to become a 60 billion rupees top line revenue company by March 2021," Sarkari said, adding the company posted 34 billion rupees ($469 million) in the year ended March 2018 . “A lot of these small players are going to move out as they are not going to be able to comply with post GST scenario.”
The nation wide implementation of the sales tax in July 2017 replaces a web of archaic tax laws and marked the biggest revenue collection reform in India’s post-independent history. The new measure will help companies such as Mahindra Logistics to lease more trucks and warehouses from small players and offer a one-stop solution to clients.
Credit rating agency Crisil Ltd. expects the third-party logistics market to grow as much as 21 percent on a compounded basis to 570 billion rupees by the financial year ending March 2020, Mahindra Logistics said in its latest annual report.
To contact the reporter on this story: Ganesh Nagarajan in Chennai at gnagarajan1@bloomberg.net
To contact the editors responsible for this story: Arijit Ghosh at aghosh@bloomberg.net, Abhay Singh, Unni Krishnan
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