Varuna Group, a Gurugram-based third-party logistics warehousing firm, is looking to invest around Rs 500 crore to set up 30 ‘Grade A+’ warehousing facilities across the country in the next five years, its founder and Managing Director Vivek Juneja has said.
The company, which completed 25 years of operations in May this year, has at present 25 ‘Grade A+’ facilities across 28 locations in India, with 1.2 million sqft of warehousing space. It has presence at over 900 locations, including its offices, warehouses and loading-unloading points.
While the company has its multi-user facilities spread across over 5 lakh sqft space with the largest one at Rajpura (Punjab), the rest is used for dedicated storage solutions and value-added services like labelling, reverse logistics and refurbishing, via pay-per-use model. These facilities can handle loading and unloading of around 500 trucks per day.
An early adopter of technology in the domestic logistics space, including the use of GPS devices for vehicle tracking, the company is also looking to add 300 trucks every year from the next fiscal in its current fleet of over 1,800 trucks, according to Juneja.
“We will be building 30 ‘Grade A+’ warehousing facilities in the next five years. As each facility is expected to come up at a cost of around Rs 50 crore, this will entail a total investment of around Rs 1,500 crore,” Juneja said.
The company is looking at the hybrid model wherein both the developer and the company will invest, he said.
“Varuna Group will invest around Rs 15 crore in each facility while the rest around Rs 35 crore per facility will come from the developers,” Juneja added.
In all, the company will invest around Rs 500 crore in setting up these 30 warehousing units, he said.
The Varuna group caters mainly to segments such as tyres, in which the company provides an end-to-end service, fast-moving consumer goods, pharma, lubes, food and beverage and other industrial products, among others.
He said the company will sell flexible warehousing space, a service which is currently not available in the country.
“Currently, the customer doesn’t get flexible warehousing space in india. And, here, we are offering flexible warehousing space and flexible trucking in between these warehouses,” Juneja added.
He said the group’s revenue grew 15 per cent to Rs 750 crore in the fiscal year ended March 2021 despite the pandemic. The topline (revenue) is expected to grow 10 per cent in the current year on account of the second wave of the pandemic, Juneja added.
Business from tyre clients accounts for 25 per cent, while the rest 75 per cent comes from other clients, according to Juneja.
“Last year, people were only scared and were sitting at home but this time, people got so scared and saved money for bad times, hence the demand is less.
“Since people were not expecting a second wave but that occurred, and the fear of a third wave has also started. So, people are saving for that as well,” he said.