First Flight scouts for strategic investor

First Flight Couriers, the country's second largest domestic courier company, is scouting for a strategic investor to fund its logistics foray and expansion plans in aviation.

The company, which recently started dedicated cargo airline services, is likely to dilute 10 to 20 per cent stake to fund its expansion. It plans to invest Rs 200 crore to Rs 250 crore on the same.

R K Saboo, deputy managing director, First Flight, confirmed the development and said, "We are in talks with two to three players but it is in preliminary stage."

He refused to divulge the name of the players or valuation of the company. First Flight is set to surpass Rs 300-crore revenue mark in the current financial year against Rs 240 crore last year.

Saboo said the company was in talks with aircraft leasing companies to acquire two Boeing 737-330 or 737-400 type aircraft for its cargo airline operations. These passenger airplanes would later be converted into freighters.

"We are also planning to acquire two more ATPF aircraft in addition to three similar type aircraft. First Flight will shortly connect cities such as Hyderabad and Amritsar apart from currently serviced cities such as Chennai, Bangalore, Mumbai and Delhi," he said.

The company airlifts about 1200 tonne of consignments a month by its own aircraft. The capacity of an ATPF airline is around 8 tonne of cargo.

Meanwhile, the company has announced plans to set up a full fledged logistics division to offer services including wareshousing, inventory management, cash management and supply chain management to corporate customers. The soft launch is expected in next six months.

"This is a natural progression to our present line of business. We are already operating in the air and surface line-hauls and extensive feeder and main inland services. The company plans to set up the operations of the logistics division in 20 major cities in the first year of operations," Saboo said.

Apart from multi national corporations, Indian companies are also outsouring their logistics operations.

First Flight can earn better yields as it can serve door-to-door services to its customers rather than airport-to-airport services, he added.