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With 60% growth, ecommerce is Gati’s fastest growing division

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Gati’s ecommerce revenues for the year ended March 2016 stood at Rs 207.8 crore, growing 63.1% from the previous year’s Rs 127.4 crore. Gati mentioned in its annual report that this is currently their fastest growing segment and the number of packages handled has grown in excess of 70% compared with last year.

“Between FY2011-12 and FY15-16 this segment maintained a CAGR of more than 60%,” the report added.

However, the company did not mention the number of orders shipped for ecommerce in the report. In Q4 FY16, the  logistics company also said that its ecommerce business saw about 16,000 orders per day. Dhruv Agarwal, EVP of Gati-Kintetsu said that during Flipkart’s Big Billion sale, the company was processing close to 45,000 to 50,000 orders per day across the country.

Gati’s peak daily delivery capacity have increased to 72,000 packages per day. Its last mile delivery fleet, a mix of bikers, drivers and ecommerce franchises has grown to 2,400. Currently, the ecommerce network extends to about 20,000 pin codes.

It added that  3,000 mobile devices are being used to capture pickup, delivery and scan packages of express distribution and e-Commerce at every stage.

Change in weight mix: The company added that it increasing its presence in the lower weight segment of established e-tailers. In the preceding quarter, ecommerce revenues grew 52% and attributed it to change in weight mix of the packages processed.

“Actually over the last couple of quarters we also shifted our focus to look at the lower weight categories. Beginning of this year we were doing 60% above 2 kg, 40% less than two kg and now at the end of this year we have kind of change that and doing 60% in less than 2 kg category and 40% in above 2 kg,” Agrawal explained.

Raising Rs 120 crore: In January 2015, Gati said it would be raising Rs 120 crore to expand its e-commerce business. The company said it would issue securities to Indian or foreign investors, qualified institutional buyers, foreign institutional investors, and venture capital funds.

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