Mahindra Logistics Ltd. (MLL) announced its Q1 FY25 results, showing resilience in a moderate demand environment. The Contract Logistics segment saw a 9% year-on-year revenue increase, reaching INR 1,045 crore. The Freight Forwarding business experienced a 12% growth from the previous quarter, driven by inbound ocean cargo demand. The Express business posted a 2% revenue rise, reaching INR 210 crore, with a 16% reduction in losses. MLL's joint venture with Japan's Seino Holdings Ltd. and a new warehouse in Guwahati highlight its strategic expansions. Despite challenges like higher start-up costs and manpower expenses, CEO Rampraveen Swaminathan remains optimistic about the year's outlook.
Mahindra Logistics Ltd. (MLL), a leading Indian logistics provider, recently announced its financial results for the first quarter of FY25 (April-June 2024). While the company faced a moderate demand environment, it reported some positive developments and expressed optimism for the rest of the year.
Despite a muted market, MLL's Contract Logistics segment, which manages supply chains for clients, saw a 9% year-on-year increase in revenue, reaching INR 1,045 crore (compared to INR 959 crore in Q1 FY24). The Freight Forwarding business, which handles international cargo movement, also experienced a 12% growth compared to the previous quarter, driven by rising demand for inbound ocean cargo (imports).
The Express business, which delivers packages and documents, showed a 2% year-on-year rise in revenue, reaching INR 210 crore (compared to INR 206 crore in Q1 FY24). MLL also highlighted a 16% reduction in losses for this segment (INR 9.3 crore loss in Q1 FY25 compared to INR 11.1 crore loss in Q1 FY24), indicating success in cost optimisation efforts. Furthermore, the company's Mobility and Last Mile Delivery services continued their growth trajectory.
MLL announced a significant joint venture with Seino Holdings Ltd., a Japanese logistics giant. This partnership aims to offer comprehensive logistics solutions for Japanese automakers and related companies operating in India. Additionally, MLL expanded its warehousing footprint by launching a state-of-the-art facility in Guwahati, Assam, bringing its total warehouse space under management to over 20 million square feet.
MLL acknowledged the impact of higher start-up costs, increased manpower expenses, and rising warehouse lease rates on their earnings. Lower volumes in the Express business also played a role. However, the company's CEO, Rampraveen Swaminathan, expressed confidence in improvement for the later part of the year. He cited healthy order bookings in key segments and ongoing cost management initiatives as reasons for optimism.
Overall, Mahindra Logistics is navigating a challenging economic climate by focusing on strategic partnerships, cost control, and service expansion. The company's performance in the coming quarters will be closely watched to see if it can achieve its growth goals.
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