Indian road logistics on a smooth ride in FY2024

The credit rating agency ICRA anticipates a favourable demand scenario for the road logistics sector in FY2024, aided by stable domestic consumption and investment demand.

The industry revenue growth is pegged at 6-9% in FY2024 on an elevated base of FY2023.

It is driven primarily by demand from varied segments like e-commerce, FMCG, retail, chemicals, pharmaceuticals, and industrial goods.

Meanwhile, it is coupled with the industry’s paradigm shift towards organised logistics players, post-GST and e-way bill implementation.

ICRA expects the outlook for the sector to remain stable.

Downside risks to the estimates remain from any material tapering of demand due to elevated inflation and interest rates and global supply-demand shifts impacting the Indian economic scenario.

Suprio Banerjee, ICRA: “With gradual demand recovery on the back of supportive macro-economic factors, ICRA’s sample set witnessed revenue growth of 16 percent in FY2023 on a YoY basis, amid a low base of FY2022.”