India’s Ecommerce Logistics Sector Set To Cross 10 Bn Parcels By FY28: Redseer
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India’s Ecommerce Logistics Sector Set To Cross 10 Bn Parcels By FY28: Redseer

Govt To Release Draft Ecommerce Policy In Coming Weeks

The Indian eLogistics market is continuing to experience significant growth in FY23, as per the latest report by Redseer Strategy Consultants.

The total number of shipments, including both forward and reverse logistics, for eCommerce logistics exceeded 4 billion in FY23, excluding hyperlocal shipments. 

In-house logistics and third-party players had almost an equal share in this segment. Throughout the year, the industry faced increasing competitive pressure from smaller incumbents, resulting in lower yields. 

Nonetheless, the market remains an attractive long-term opportunity, with the e-commerce logistics sector projected to grow at a minimum CAGR of over 20 per cent and comfortably exceed 10 billion parcels by FY28, driven by steady eCommerce growth.

D2C as an opportunity
The Direct-to-Consumer (D2C) sector has emerged as a robust growth segment within eCommerce, with D2C brands projected to achieve a 35 per cent increase in overall Gross Merchandise Value (GMV) in the next few years. 

The platform is expected to account for a significant portion of this growth. 

By CY27, D2C brands across all channels are estimated to generate a total GMV of USD 33 billion. 

Logistics companies that offer customised services to cater to the requirements of D2C brands are in a favourable position to capture a share of this high-growth market.

 Additionally, these companies are expected to have a stronger yield profile going forward.

In this context, it is worth noting that the definition of D2C used here pertains to online-first new age brands from Indian players.

Winning business models
According to Redseer data, Delhivery continues to be the leading player in the eCommerce third-party logistics (3PL) segment for parcels in FY23, despite facing increasing competition.

Its broad range of services for D2C brands, coupled with a fast-growing non-eCommerce business, has resulted in better protection against recent macro trends in the eCommerce industry, making it a more durable logistics enterprise overall.

“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 or large goods or non-ecommerce segments like C2C , PTL/FTL and wider SCM 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

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