Mahindra Logistics hosted a conference call on Oct 28, 2021. In the conference call the company was represented by Rampraveen Swaminathan, Managing Director and CEO.

Key takeaways of the call

The company continue to witness a strong growth in revenue, driven by growth from new wins in E-commerce, Consumer & Freight Forwarding.

The demand from the auto industry in Q2FY22 remained stressed due to shortage of semi-conductors. However, the farm sector continued to see positive momentum as production remained consistent. E-commerce saw good traction in demand in tier two and three towns. The consumer sector like FMCG, personal care etc did well. In electronics, appliances category saw cross border challenges with respect to sourcing of components.

The sector has positive tailwinds in terms of Gati Sakti program which includes setting up 500 multimodal logistics parks. The sector is expected to see Rs. 50,000 crore investments across five years.

Despite headwinds in the Auto industry, the focus on designing and delivering customized, integrated solutions continues to be a key driver for the growth of the company.

The mobility business continues to see a recovery with focus on new segments & customers.  This segment see some green shoots with the rising trend of employees returning to offices.

The company also built ‘flex' warehouses for e-Commerce clients. The company decreased the low yielding stockyards.

Wave 2 of the Covid-19 pandemic has resulted in delays of new projects.  The company during the quarter added 1.3 million square feet of grade 'A' warehouse capacity. The company has contracted 4 msf of warehousing space and that are under construction and these capacity will come on stream/added by Q2FY2023. Capex for FY22 will be about Rs 80-90 crore.

Fuel cost continue to see sharp increase. 

The company is optimistic of continuing growth with the upcoming festive season and aim to sustain its focus on delivering technology-enabled, integrated solutions.

MLL will continue to build new capabilities which will allow for better customer acquisition and retention. In Q2FY22 it executed contracts with leading pharmaceutical and two-wheeler companies in the southern region.

The company have piloted drone-based delivery of medicines in Telangana. MLL continues to leverage and build on its technology roadmap to offer best-in-class solutions to customers.