French third-party logistics company FM Logistic has said India is a significant growth engine for the company and it is expecting its business here to account for 20-25 per cent of the overall topline in the next five years.
The company also said FM Logistic India has grown three times in both revenue and land space under its possession since its entry in the domestic market after acquiring Pune-based logistics firm Spear Logistics.
FM Logistic India, which opened its first owned multi-client facility in Farrukhnagar (Haryana) last week, has a presence in 90 locations and manages more than 7 million sq ft of warehousing space. It provides warehousing and distribution logistics services for the FMCG, retail, automotive, e-commerce, engineering, telecom, pharma and other sectors. It has four multi-client facilities (MCFs) — one each in Bengaluru and Gurugram and two in Mumbai.
“India is a major country for us, a significant engine for growth. As a family-owned company, this country is a part of our future for the long-term. We have a long-term view on India. So, we see this country as a country where we can do business,” Jean-Christophe Machet, Global CEO, FM Logistic, told PTI in an interaction.
Stating that the Indian subsidiary was able to post a 50 per cent growth in turnover in the previous fiscal despite the pandemic, he said the company is expecting 40 per cent growth this fiscal.
According to a company presentation, besides 50 per cent growth in turnover, FM Logistic India increased its warehousing footprint by 20 per cent during FY22, while 30 per cent of its total revenue came from multi-client facilities.
Also, 60 per cent of the new contracts that FM Logistic India signed during the previous fiscal were for omni-channel operations.
“I think, probably, 20 per cent or a quarter of FM Logistic’s total revenue will come from India operations in the next five years,” Machet said without giving specific numbers.
In September last year, FM Logistic had while presenting its new strategy ‘Powering 2030’ — designed to address profound changes in the retail industry and supply chain management as consumers spend more online — said that it was aiming to double its revenue to 3 billion euros in 2030 by focusing on omni-channel supply chain.
The French firm had in 2019 announced investment to the tune of 150 million euros (about Rs 1,200 crore) for five years for setting up warehouses in India.
Machet said as much as one-third of this investment has already been consumed with 30 million euros going into the first phase of the Farrukhnagar facility alone.
“This (150 million euro) investment is sufficient to implement our business plan for the next 3-5 years. Majority of this investment will go into setting up of MCFs,” he said.
Located on a 31-acre site, the state-of-the-art facility at Farrukhnagar will offer 7.6-lakh sq ft of warehousing space, providing warehousing and handling, co-packing, distribution, e-commerce and omni-channel services to cater to the dynamic demands of customers, the company said at the launch.
FM Logistic India is currently among the top three logistic services providers in the domestic market, focused on grade-A multi-client facilities, dedicated warehouses near its customers’ manufacturing centres and modern logistics hubs.
Noting that all the segments are of strategic importance for the company, FM Logistic India Managing Director Alexandre-Amine Soufiani said sectors such as FMCG, e-commerce, automotive and retail, among others, are expected to drive growth in the next 2-3 years.
He said the company is looking to almost double its footprint to 12-million sq ft from over 7-million sq ft now and set up six more MCFs to take the total number to 11 by 2026.
“Now more and more of our customers are looking at optimising the last-mile deliveries as well. And again, we are not just entering the last mile-delivery and doing what the others are doing. We’re looking at a quality kind of service in the last-mile delivery,” he said.