Listed third-party logistics player Delhivery Ltd expects its one-month-old rapid commerce business to generate revenue in the range of ₹80-100 crore by the end of the current fiscal year, underscoring the growing demand for ultra-fast deliveries in India’s e-commerce landscape, co-founder and chief executive officer Sahil Barua, said on Friday.
The Gurugram-based courier company rolled out Rapid Commerce, a sub-2-hour delivery service, in January. It is specifically designed to help direct-to-consumer brands, and e-commerce platforms reduce delivery timelines and improve customer experience.
“Rapid Commerce is an add-on product for the top eight cities [designed] for specific customers and SKUs [stock-keeping units]. I expect that this business will add maybe somewhere between 80 and 100 crore [rupees] of revenue to Delhivery through the financial year. And the margin structure will broadly be similar to the express business as a whole,” Barua said during the third-quarter earnings call.
Q-commerce competition
“It’s an interesting business. It’s a good capability for Delhivery to build. It helps us serve our D2C customers and their customers much better,” Barua added. The service is live in Bengaluru, Hyderabad and Chennai and is scheduled to add another 15 clients by the end of the next quarter.
Competition in quick commerce is heating up, prompting players to increase investments in expanding dark stores and hiring more personnel to keep delivery timelines short. On Friday, logistics provider DTDC launched 2-4 hour express delivery with its first dark store in Bengaluru. In May, logistics aggregator Shiprocket introduced ‘Quick’ to assist small and medium-sized businesses join the quick commerce rush.
Barua said that Delhivery’s first set of dark stores is already logging 500 orders daily and is expected to break even when it touches 700-800. The contribution of direct-to-consumer brands to Delhivery’s express volumes has now grown to 30%, while that of small and medium businesses has surged to 50%.
The company plans to add up to 50 dark stores to service the top eight metro cities.
Q3 performance
Delhivery’s profit after tax zoomed 114% year-on-year to ₹25 crore in the December quarter, marking its third consecutive profitable quarter. Its revenue from operations grew 8% to ₹2,378 crore from the year-ago period.
Express parcel revenue grew 3% YoY to ₹1,488 crore, while part truckload revenue grew 22% YoY to ₹462 crore.
Former global CEO of Airtel Vani Venkatesh joined Delhivery as the chief business officer, the firm said in a statement on Friday. Venkatesh has over two decades of experience across industry verticals, having served in leadership roles in companies like Airtel, McKinsey, Unilever and Abbott Nutrition. She previously served Airtel in various management roles, including CEO for Global Business, CEO for Delhi NCR Region, chief marketing officer & CEO for their Retail Business.
On Friday, the firm also appointed Namita Thapar, executive director at Emcure Pharmaceuticals Ltd, and Sameer Mehta, co-founder and CEO of boAt Lifestyle, as non-executive independent directors to the board.
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