During the course of the year, the industry saw intensifying competitive trends from smaller incumbents with yields also being challenged. However, despite this, the market is an attractive long-term bet with the overall e-com logistics opportunity to grow at a minimum CAGR of over 20% to comfortably exceed over 10 billion parcels by FY28 on back of steady e-commerce growth.
D2C as an opportunity
D2C* has emerged as a strong growth segment within e-commerce- D2C brands across channels are expected to grow overall GMV at 35% in next few years, with brand.com accounting for a significant share of this growth. A total of $ 33 billion 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.
*D2C definition here refers to online-first new age brands from Indian players
Winning business modelsDespite intensifying competition threats, Delhivery remains the clear market leader in FY23 within e-commerce 3PLs parcels-as per Redseer data. Further, its wide set of offerings for D2C brands along with fast-growing non-ecommerce business also makes it better insulated from the recent macro trends in the eCommerce space and a more resilient logistics business 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-e commerce 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,” Mrigank Gutgutia, Partner, Redseer Strategy Consultants, said in a statement.
