Mahindra logistics reports loss in Q1, cites higher expenses, weak demand

Mahindra Logistics swung to a loss in the first quarter on Monday, hurt by higher expenses and lukewarm demand.

The freight carrier posted a consolidated net loss after tax of Rs 85.5 million ($1.04 million) in the three months ended June 30, compared with a profit of Rs 135.2 million a year earlier.

Total expenses

Consolidated total expenses surged nearly 10 per cent to Rs 12.99 billion. The company had earlier flagged an impact on its business from slowing network expansion in e-commerce and consumer markets, which analysts believe led to weakening demand resulting in a muted quarter with limited volume growth.

It had also cautioned about a spillover from larger events like global financial turmoil and unseasonal rain in some parts of the country.

The last time the company had posted a loss after tax was in the quarter ended June 2020, during the COVID-19 pandemic that hit the cargo movement industry as economic activities across the world came to a halt.

The company, in an exchange filing, said demand is expected to improve in FY24 with the return to the office being normalised. Its enterprise mobility services segment surged 39 per cent to Rs 794.6 million.

The logistics arm of Mahindra Group, which competes with Delhivery, offers services like cargo and freight movement, workforce management and warehousing facilities to multiple industries.