US firm STI to piggyback Patel Retail for India entry

The US-based home delivery and logistics company STI (Specialised Transportation Inc) is entering into Indian market by entering into a strategic alliance with Patel Retail, a subsidiary of Patel Integrated Logistics (PIL).

STI, a high-value transportation company, is a specialised home delivery major offering computer, telecommunication products, robotics, medical & office equipment, fine art, commercial relocations and store fixtures.

STI may also pick up a minority stake in the Patel Group at a later stage following this alliance. As per the business plan, STI will manage home delivery products by using warehouses and logistics support for Patel Retail.

Through this strategic alliance, STI will get access to Indian market using Patel Retail network and the latter will get exposure to the US market. However, the investment details of this venture has not been disclosed.

PIL Vice-chairman Arif A Patel said, "The business model of STI and Patel is complimentary. STI will make use of 400 odd branch network in India while we can use the wide network of STI in the US."

According to industry analysts, the alliance with STI will help Patel Retail to fill up the existing capacity and increase the distribution network. "The in-bound and outbound traffic of STI will boost the bottom line of the Indian partner," they said.

Patel said the association with STI will also enable to access the advanced technology to streamline the logistics operations.

Patel Retail, which was launched in November 2006, has surpassed Rs 1 crore a month revenue mark and it is planning to increase it to Rs 3 crore a month in the next three months, Patel said.

Patel Retail has recently opened new hubs such as Chakan (Pune), Chennai, Indore and Gurgaon. Meanwhile, retail major Future Group is in advanced talks for picking stake in PIL.