Avis to invest Rs 950 cr to add 8,000 vehicles in 3-4 years

“The market for operating lease is growing gradually. We plan to invest Rs 700 crore over the next 3-4 years to have 7,000 vehicle on operating lease business,” Avis India Chief Executive Officer Sunil Gupta told reporters here.

The company will offer an overall service package in the model — Red Carpet Lease — that will include insurance,maintenance and other requirements of the vehicles,he added.

“From the leasing business,we expect a revenue of Rs 200 crore in the next three years,” Gupta said,the company will launch the service in 7-8 prominent business cities.

The company will also hire 100 people for this new business. Currently it employs 350 people,he added.

According to Avis India,the operating leasing market in the country currently stands at around USD 300 million with about 45,000 vehicles.

“The market growing very strongly. In the next five years,it is likely to expand to USD 800 million to USD 1 billion and about 1 lakh vehicles may ply in this business,” Gupta said.

Talking about its other models,he said the company is expanding its existing fleet size in the next 3-4 years.

“Currently we are operating 1,500 cars and we will add 1,000 more vehicles at an investment of Rs 250 crore. We also want to expand our presence from 19 cities to more places ,” Gupta said.

When asked about mode of funding its investment,he said it will be done through equity and debt.

Gupta said Avis India is aiming for a turnover of Rs 300 crore by 2014-15 from about Rs 150 crore,which is expected in this fiscal.