Shriram Group to Expand its Automall Business in Big Way

Shriram Automall India Limited (SAMIL) records a great response from its customers, mainly small truck operators, along with around transactions of one lakh vehicles valued at about Rs 1,500Cr in last year, conducted through its platforms. The company has drawn up an aggressive expansion plan and will soon start handling two-wheelers also.

The SME segment (including truck owners having up to five vehicles and small retailers) currently contributes around 35% of the business, while the balance is from banks, dealers and original equipment manufacturers. "Over the next few years, we want to take the SME segment's contribution to around 60%," quotes Mr. Sameer Malhotra, CEO of SAMIL.

Traditionally, small truck owners rely on the unorganised sector, where not only is transparency an issue, but customers are often taken for granted.

 The second-hand sales market is currently estimated at Rs 1-1.2 lakh Cr.

ü  Of this around Rs 30,000Cr comes from trucks

ü  Rs 15,000Cr from construction

ü  Rs 15,000Cr from tractors

ü  And the balance from cars and two-wheelers.

A major chunk of this business is in the hands of the unorganised sector. To tap this market, the Group decided in 2011 to set up Automall, which incorporates all the elements of a physical bidding platform.

Physical bidding offers scope for networking, as various traders participate in the event and share information on market trends. More than 100 physical bidding events in over 100 locations take place across India, resulting in sales of more than 6,000 vehicles every month.

In 2013-14, bids were placed for one lakh vehicles worth Rs 1,500Cr, up from 60,000 vehicles worth Rs 850Cr in 2012-13.