If you’re landing here, fresh to this story, we recommend you read Part I first.
Now, let’s get on to Part II.
The buyer
The logistics business in India is a highly fragmented industry. There are local, national and international players. There are courier companies, express delivery cargo companies, next-day delivery parcel companies, third-party logistics providers, warehouse providers, road transporters, individual truckers, air cargo freight companies, shipping companies and some large companies, which do all of the above. Like the Transport Corporation of India (TCI).
Now, in the courier business, there are players who only do intra-city deliveries, and then there are players who do multiple city deliveries plus pan India deliveries. The mom-and-pop courier companies operate out of a hole or multiple holes, known as a sorting centre. They are the lowest in the food chain because they mostly deal in documents. Like telephone bills, gas bills, electricity bills, you get the drift. Also, nobody sends letters anymore.
Why do you need to know all this? So you can understand the whole expanse of the logistics business.
And appreciate the fact that in this large world, till about last year, Anand Rai was a fairly small man. The owner and managing director of a company called Pigeon Express Private Limited. It is a family-run operation by two people: Anand Rai and Rahul Rai. According to several people in the trade The Ken spoke to, Rai built Pigeon Express on the back of a small courier operation, where he used to handle telephone bills, largely for Bharti Airtel in New Delhi. That and a regular documents-driven business.
According to documents filed with the MCA, as of March 2016, Pigeon Express recorded a turnover of Rs 8.9 crore, compared to a turnover of Rs 12.7 crore in the previous year. The company recorded a loss of Rs 2.2 crore as of March 2016, compared to a loss of Rs 3.9 crore in the previous year.
It is another matter altogether that nobody in the trade circles or the officials at GoJavas to whom The Ken spoke to could satisfactorily answer how Rai ended up becoming the majority shareholder in GoJavas. “I do not know if he is Snapdeal’s man or the erstwhile founders’ man,” says a vendor, who requested not to be quoted. “I do know that whenever we have asked him this, he has said ‘humko to mil gayi company saste me, kisi ka paisa bane na bane, hamara paisa banega.’” [I got the company at a really cheap price. I am not sure if others will make money but I certainly will]
We are meeting Rai at Hotel The Royal Plaza in New Delhi. The day before, he had spoken to us at length on phone.
