Low demand mars the upcoming festive season: Mahindra Logistics

Isha Rautela | | Updated on: Sep 23, 2022
Rampraveen Swaminathan, MD and CEO, Mahindra Logistics Limited

Rampraveen Swaminathan, MD and CEO, Mahindra Logistics Limited

The demand momentum remains weak, but the company will be able to sustain decent growth, says CEO Rampraveen Swaminathan

Mahindra Logistics, a third-party logistics (3PL) solution provider, anticipates a continued softening of the markets during the upcoming holiday season.

According to the company, the e-commerce/consumption market is comparatively weaker and farmer demand is more neutral than it was previously due to monsoons. The automobile sector is, however, showing signs of improvement.

Rampraveen Swaminathan, managing director and CEO, MLL, stated that though there is hope for the festival season, two challenges loom over this holiday season’s sales: “There is pressure as we enter the festival season because markets are softer. However, we don’t expect that to have a big impact on our volume.”

He explained to businessline: “Q1 was strong; Performance was not necessarily through underlying volume growth in our existing accounts. Volume growth came through growth through account expansion and account acquisition. The other problem is the costs due to inflationary pressure, which makes the margin corridor extremely narrow.”

Therefore, the demand momentum remains weak, but the company will be able to sustain decent growth as they work through these challenges, the CEO added. 

Mahindra Logistics reported net revenues of ₹1,068.95 crore in June 2022, up 37.92 per cent from ₹775.06 crore in June 2021.

In the next three to four years, the company aims to grow to a revenue of ₹10,000 crore. “We plan to scale up our 3PL business and integrated solutions, dramatically increase growth in our network services businesses, and expect a recovery in our mobility business,” said Swaminathan.

CATAPULT programme

The third-party logistics company held the second edition of its incubator programme on Thursday in Bengaluru. The CATAPULT is a technology-based initiative of the company.

“Through the tech partnerships with the start-ups, we are giving them a platform to deploy their technologies as part of our suite.” The third-party logistics company signed a memorandum of understanding with eight start-ups during Catapult 2.0. The Catapult Incubator focusses on identifying technology solutions in the logistics, supply chain, and mobility spaces.

Published on September 23, 2022
COMMENTS
  1. Comments will be moderated by The Hindu BusinessLine editorial team.
  2. Comments that are abusive, personal, incendiary or irrelevant cannot be published.
  3. Please write complete sentences. Do not type comments in all capital letters, or in all lower case letters, or using abbreviated text. (example: u cannot substitute for you, d is not 'the', n is not 'and').
  4. We may remove hyperlinks within comments.
  5. Please use a genuine email ID and provide your name, to avoid rejection.

You May Also Like

Recommended for you