Compelled by a surge in online sales and a growing e-commerce segment, other allied segments such as logistics also witnessed robust growth in the past fiscal year. The country’s e-commerce logistics space recorded more than four billion parcels in FY23, according to the latest report by Redseer Strategy Consultants. “Within this pie, in-house logistics versus third-party players have a roughly equal share,” says the report.

The overall e-commerce logistics opportunity is expected to grow at a minimum CAGR (compound annual growth rate) of more than 20% to comfortably exceed over 10 billion parcels by FY28 on the back of steady e-commerce growth in Tier-II cities.

“Despite funding headwinds in eCommerce/Internet sectors, there are multiple pockets of high growth and high yield opportunities available for eLogistics players, be in D2C (direct-to-consumer) or large goods or non-e-commerce segments like C2C (customer-to-customer), PTL/FTL (partial truckload/full truckload) and wider SCM (supply chain management) services. Players who build robust capabilities and offerings to serve this demand effectively will fundamentally be more resilient in these challenging times and will be better positioned for long-term market share and yield leadership ”, says Mrigank Gutgutia, Partner, Redseer Strategy Consultants.

Amongst segments within e-commerce, the D2C segment has witnessed strong growth in the past year. As per the report, D2C brands across channels are expected to account for 35% of the overall GMV (gross merchandise value) of the e-commerce segment in the next few years, with accounting for a significant share of this growth.

“ A total of $ 33 Bn of GMV is expected to be generated from D2C brands across all channels by CY27. As such logistics players with relevant and customized offerings for D2C brands are well positioned to capture market share in this high growth segment as well as have a stronger yield profile going forward,” the report says.

Among logistics players in the country, Delhivery emerged as the frontrunner in FY23. Amidst the global headwinds, Delhivery’s wide set of offerings for D2C brands, along with its fast-growing non-e-commerce business, makes it better insulated from the recent macro trends in the e-commerce space and a more resilient logistics business overall, the report adds.

Notably, in the October to December quarter of FY23, the Gurugram-based logistics services provider reported a net loss of ₹196 crore compared with a loss of ₹126 crore in the corresponding period last fiscal. The logistics firm’s revenue from operations stood at ₹1,823 crore during the quarter under review. Segment-wise, revenue from the partial truckload freight segment stood at ₹277 crore in the quarter-ended December 2022 and revenue from Delhivery’s Express Parcel services stood at ₹1,200 crore in Q3 of FY23.

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