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Blue Dart India results for the April-June
2022 quarter saw a four-fold jump in its net profit: INR 119 crores
or USD$1,49,15,924. The company’s strong performance has seen
revenue going up around 50 percent to INR 1,293 crores or USD$1,62,072.
Managing Director Balfour Manuel said:
“Life in the pandemic has leap-frogged.
We are out of the pandemic now. It is a mix—better realization,
yield improvement, digitization, service quality and cost management.”
Blue Dart witnessed “healthy
volume growth during the quarter and carried 77.08 million shipments
(last year 51.22 million shipments) comprising 278,393 tons (last
year 184,431 tons).”
The consistent robust performance
along with the recent quarter’s showing – in fact, the
company leads the domestic air express market with around 50 percent
market share – has led Blue Dart’s management to chalk
out expansion plans. These plans include acquiring bigger aircraft
– it has a fleet of eight freighters – and it is also
mulling expanding its charter operations to countries like China
and Vietnam even as it sets up gateways away from the metro cities
to India’s small towns.
Manuel mentioned the usual suspects:
“Our fleet expansion will enhance
our geographical reach and widen our capacity to service current
and potential demand across industries. Moreover, our key growth
levers for the upcoming year will revolve around leveraging the
power of technology and digitalization to provide sustainable logistic
solutions with a deep focus on carbon sequestration.”
The GatiShakti Factor
”With an eye on growth in the
future, Blue Dart is banking on the government’s focus to
improve infrastructure through the GatiShakti National Master Plan
for multimodal connectivity that will see dedicated freight corridors,
logistics parks, economic zones, rail corridors and waterways that
will ease the movement of goods. These initiatives will provide
the necessary boost to the economy of the country.
“Blue Dart wants to leverage
these growth opportunities to cater to the demand for higher capacities,
by expanding its network.”
Follow The Fleet
Fleet expansion will see Blue Dart
getting new aircraft. Of the eight freighters it presently has in
its fleet, six B757s will be phased out in a few years leaving it
with two B737-800s. Sources indicated that it will induct two B737-800s
by the end of 2022.
Additionally, Blue Dart joins the
big parade looking for new freighters to help it to increase the
tonnage per aircraft by 60 percent. The new freighters will fly
into Tier II cities based on load factors. The B737s will be ideal
for smaller airports. Already, the company has started looking for
pilots and engineers for the planes.
Blue Dart birds operate only at night
because the congestion at the major airports of India continues
through the day.
Blue Dart wants its international
charter operations to grow and not without reason. The international
charter services have brought good returns to the company: the margins
in the last quarter were at an all-time high level of 18.7 percent.
These operations started during Covid when Blue Dart flew medical
supplies to Guangzhou and Shanghai.
Later, there were flights to Hong
Kong, Bangladesh and Myanmar.
These flights, conducted during the
day, saw the freighters back in their base in time for domestic
operation.
New Cities Hubs
Along with the acquisition of freighters,
Blue Dart is expanding its ground hubs and network to handle the
expected growth in volumes. It is a smart business move since it
will enable Blue Dart to pick up cargo originating from these smaller
cities to fill the freighters.
The cities where cargo bases will
be set up would be Guwahati in the North-East and Coimbatore and
Kochi in the South. While Guwahati, the gateway to Northeast India
is a major air hub for transportation and business, Coimbatore International
Airport caters to around eight districts that serve the export and
domestic markets and Kochi in Kerala serves the Cochin Economic
Zone as well as the Tirupur-Coimbatore cargo hub, a key cargo market.
For the moment, Blue Dart is on strong
ground but competition is looming with IndiGo launching its own
freighter services. Further, most passenger carriers have strengthened
their cargo services.
Bring On The Competition
A new freighter airline, Pradhaan
Air was launched recently but Blue Dart’s Manuel does not
seem too worried.
He maintains these freighter services
are necessary and “complement our business, as we use their
services often to reach locations.”
For Blue Dart, its tie-up with DHL
provides it a solid base (international logistics giant DHL holds
a 75 percent stake in the company) and through a special arrangement,
it focuses entirely on the domestic logistics sector. That understanding
prevents Blue Dart from not expanding internationally.
Even so, according to Manuel, DHL
directly connects Blue Dart to 220 countries. “The complimentary
strength that DHL provides in the international sector for our customers
is unmatched and, vice versa, we compliment them in the domestic
sector.
“It’s a great strength
and an association built over the years since 2004.”
Tirthankar Ghosh
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