India's Mahindra Logistics swings to loss on higher costs, weak demand

Mahindra Logistics

24/07/2023 11:37

BENGALURU, July 24 (Reuters) - India's Mahindra
Logistics  MALO.NS  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 85.5 million rupees ($1.04 million) in the three months ended
June 30, compared with a profit of 135.2 million rupees a year
earlier.     
    Consolidated total expenses surged nearly 10% to 12.99
billion rupees.
    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. 
    Consolidated revenue from operations rose about 8% to 12.93
billion rupees, lifted by more than 6% growth in its mainstay
supply chain management business. 
    The company, in an exchange filing, said demand is expected
to improve in FY24 with the return to office being normalised. 
    Its enterprise mobility services segment surged 39% to 794.6
million rupees. 
    The logistics arm of Mahindra Group, which competes with
Delhivery  DELH.NS , offers services like cargo and freight
movement, workforce management and warehousing facilities to
multiple industries. 
    Shares of Mahindra Logistics ended 2.7% lower after the
results. 

($1 = 81.8457 Indian rupees)

 (Reporting by Hritam Mukherjee in Bengaluru; Editing by Sohini
Goswami)
 ((Hritam.Mukherjee@thomsonreuters.com; Twitter:
@MukherjeeHritam;))