Check out Business Today's annual listing of companies you need to keep your eye on. Allcargo
Check out Business Today's annual listing of companies you need to keep your eye on.
Profiting from pain pointsShashi Kiran Shetty likes it big. Soon after his 14-year old company debuted on the stock markets last year, the promoter of Allcargo Global Logistics announced the purchase of Ecu Line—a Belgium-based logistics company almost five times Allcargo’s size with 120 offices in 65 countries. It was the first global acquisition by an Indian logistics company. Evidently, investors like him betting big. Allcargo’s stock price almost doubled in the first six months of its IPO. Today, it quotes around Rs 946, a relatively high multiple of 25.43 on 2007-08 earnings.
What’s got investors all excited about Allcargo, which hopes to finish this fiscal with a topline (standalone) of Rs 415 crore and a bottom line of Rs 75 crore? Apart from the fact that it is already an end-to-end logistics company in India with a presence in multi-modal transport to container freight stations to project cargo handling, “we are planning to set up logistics parks of 50 to 100 acres in five key locations”, says Shetty, 50, Chairman and Managing Director. These parks would handle container depot and international cargo, and have warehousing complexes and distribution centres.
The project is expected to be part financed by a Rs 300-crore equity offering (Mumbai-based Shetty and his family, who own 90 per cent of the company, may dilute their own stake). Having cleaned up the balance sheet of Ecu Line, Shetty is planning to beef up his international operations. “We are eyeing regions like Abu Dhabi and Doha (Qatar),” says the golf enthusiast Shetty.
-- Anand Adhikari