Delhivery, a logistics unicorn startup, has reportedly, been in advance talks with Blue Dart Express Ltd and Gati Ltd to taken over their B2B operations, reported Mint, citing two sources close to the development.
“Delhivery’s focus is mostly on the e-commerce segment, and has shown healthy growth. It’s not an unusual idea to look out for M&As. And since Blue Dart has a pretty strong franchise business in India, it is attractive to Delhivery from a B2B business perspective,” said one of the people cited above.
Delhivery, based out of Gurugram, was founded in 2011 by Sahil Barua, Mohit Tandon, Bhavesh Manglani, Suraj Saharan and Kapil Bharati. The company’s vision is to become the operating system for commerce in India, through a combination of world-class infrastructure, logistics operations of the highest quality and cutting-edge engineering and technology capabilities.
Logistics businesses usually receive the highest order values from direct corporate tie-ups, a strong point of Blue Dart, as per the one of the above cited sources.
“Blue Dart has a vast logistics fleet of its own, good pin code coverage and entrenched corporate relationship with big brands. A lot of the strength in traditional logistics business lies in leveraging loyalty,” the source said.
“Blue Dart has long-standing tie-ups with a lot of corporates for their B2B vertical. Retail logistics is a different market altogether, but B2B vertical is the biggest play for traditional logistics firms. The deal is also for user acquisition,” it added.
While, in September this year, Blue Dart posted a 35 per cent year-on-year fall in consolidated net profit at INR 14.64 crore.
Gati, on the other hand, posted a net loss of INR 11.10 crore for the quarter ended 30 September, compared with a net profit of INR 1.31 crore during the same period a year ago.
Furthermore, as per the report published by CARE Ratings in 2018, India’s logistics industry is expected to be worth $215 billion by 2020-21.