Domestic road logistics industry revenues likely to grow up to 9%: ICRA

The domestic road logistics industry is expected to register a growth of up to 9 per cent in revenues in the ongoing 2024-25 financial year, according to ICRA.

The organised road logistics sector had witnessed a growth 4.6 per cent in the 2023-24 fiscal year, the ratings agency said in a report.

As per ICRA, the industry logged a revenue of Rs 23,273 crore in FY24.

"ICRA expects the revenues of the Indian road logistics industry to grow by a moderate 6-9 per cent year-on-year (y-o-y) in FY25," it said.

The agency further said it also maintains a stable outlook for the sector, fuelled by various government measures and policies in favour of the sector on expectations of good demand outlook from segments like e-commerce, FMCG, retail, chemicals, pharmaceuticals, and industrial goods.

Srikumar Krishnamurthy, Senior Vice President & Co-Group Head Corporate Ratings, ICRA Ltd, said, "In FY24, the growth was subdued on account of a relatively muted demand amid high inflation, an uneven monsoon, a relatively lacklustre festive season and the rising interest rate regime."

"We expect the industry operating profit margins to remain in the range of 11-12 per cent in FY25, with the organised players expected to maintain the pricing premium amid an overall inflationary cost scenario," he said.