The earnings growth (annualised earnings per share works out to be Rs 2) will be the result of a cost cutting excise undertaken by the company. The one-month long postal strike in July has also added to the company's coffers. Blue Dart Aviation Ltd, a wholly-owned subsidiary, will contribute to its parent's bottomline this year as it has achieved a breakeven during the first-quarter of 1998-99. Revenue will also flow from Blue Dart's recently expanded services network to cover 1,005 locations across the country.

During 1997-98, the company had entered into afive-year contract with FedEx. The commencement of this contract impacted Blue Dart's revenue by Rs 12.50 crore. However, under the terms of the contract, the growth of FedEX's sales in the Indian market will add to Blue Dart's earnings in fiscal 1998-99 onwards. This will compensate for the short-term impact on revenue and profit.

In fiscal 1997-98, Blue Dart had incurred a loss of Rs 4.24 crore. Although the company witnessed an increase in volumes due to the start-up of its aviation subsidiary, Blue Dart could not market these services because of regulatory hiccups. Besides, severe competition from the unorganised sector also ate into Blue Dart's revenue growth.

The company has a 36 per cent market share in the industry and offers an exhaustive range of services and products for both the international and domestic shippers. Measures like improving capacity utilisation of its aircraft will help boost domestic sales.

Blue Dart has been appointed the global service partner of Federal ExpressInternational with exclusive rights for pick-up and delivery services within India. It's tieup with Cargolux, to provide tonnage for its Indian operations, also augurs well for the future.