Concor logistics tying up with Bharti-WalMart

NEW DELHI: Public sector logistics major Container Corporation of India (Concor) has diversified into back-end retail. It is learnt to be close to tying up with Bharti-Wal-Mart to procure and supply fruit to the retailer. Leveraging on its logistics strength, the company is looking at establishing itself as a long-term pan-Indian supplier of fruit to big retailers, including Subhiksha, Big Bazaar and Mother Dairy.

Concor is expecting a turnover of Rs 45 crore this year for this business and aims to achieve an annual revenue of Rs 1,000 crore in three years. Concor reported a revenue of Rs 3,114 crore for 2006-07.

“There is a huge consumer demand for fruit in the country, much of which is imported. So, there was a great business opportunity. When we evaluated the entire cost of starting this business, including setting up cold chains, it was found that returns could be pretty attractive,” says Concor director (finance) Suresh Kumar. The internal rate of return for the company is said to be close to 25% for this business.

Concor has recently set up a controlled-atmosphere store at Rai near Sonepat in Haryana at a cost of Rs 92 crore. A controlled-atmosphere store is a better version of cold storage that regulates temperature as well as oxygen and carbon dioxide content in the atmosphere, enhancing the life of apples stored in it for up to eight months. Concor’s warehouse can store up to 14,000 tonnes of apple.

This year, the company mainly dealt in apples, with very small amount of cherries and pears also being stored. The company sold its fruit through Mother Dairy, Subhiksha and Big Bazaar outlets in the national capital region.