DTDC plans premium service, with value for money promise

To recruit key personnel to grow faster.

DTDC, the express logistics firm, will in the new year be launching a new premium product that will seek to deliver greater value for money to those seeking top of the line service at below market leader prices.

Termed 'V Series', the service will deliver documents upto one kg the next day under money back guarantee in case of non-performance.

The firm's aim is to guarantee fixed time delivery by the end of the year to match the premium service provided by express delivery firms in the developed economies.

A special feature of the service will be SMS or e-mail confirmation of delivery to the sender so as to raise his level of comfort.

The service will initially be restricted to six metros with plans to extend it to 25 cities in four quarters.

DTDC is also undertaking a major diversification into the freight and cargo business and is in the final stages of bidding to acquire a freighter, revealed Subhasish Chakraborty, chairman and managing director.

The acquisition will be funded by both retained earnings and borrowings. DTDC is currently a zero debt company, having been cash positive through its 16 years' of existence.

Should things pan out as planned, DTDC will end 2007-08 with a freight business of Rs 15 crore.

It plans to grow its existing business to Rs 210 crore in 2007-08 from the Rs 170 crore likely to be achieved in the current year.

Profit before tax will likely touch Rs 25 crore compared to the current year's expected Rs 17 crore.

In 2005-06 it clocked a revenue of Rs 145 crore and PBT of Rs 13 crore.

ADAG led by Anil Ambani earlier in the year acquired a 40 per cent stake in privately held DTDC.

Chakraborty, who owns 56 per cent, indicated that he may go in for a dilution in case he targets a big ticket acquisition.

Over 2006 DTDC has been undergoing an extensive reorganisation in order to be able to keep growing and compete with global firms which are getting entrenched in the Indian geography through both acquisition and expansion.

The operations have been grouped under three business rubrics "� international, domestic, and cargo and freight.

Newly recruited senior industry professionals will be heading these businesses.

Four product categories have also been created "� intra-city, domestic express, domestic air cargo, and domestic surface.

Delivery will take place between next day and four days, depending upon the category.

DTDC has floated a 100 per cent subsidiary called SMS Courier and Cargo to handle the intra-city and mass mailing business.

It will follow the 'bulk and break' system under which the bills of say a credit card company will be picked up from its national data centre and carried in bulk to different cities and then distributed.

Chakraborty revealed that DTDC is currently cooperating with the Indian School of Business for a case study by its service business ventures and franchising group.

It is perceived as a successful business in the small and medium category which is seeking to professionalise and keep growing.

Chakraborty says he is gone through the reorganisation so as to do less of day to day running and concentrate more on strategy.