Blue Dart Express Limited (NSE: BLUEDART) Q3 2025 Earnings Call dated Jan. 31, 2025
Corporate Participants:
Tushar Gunderia — Head of Legal & Compliance and Company Secretary
Sudha Pai — Group Chief Financial Officer
Sagar Patil — Head of Corporate Accounts
Analysts:
Alok Deora — Analyst
Unidentified Participant
Lokesh Maru — Analyst
Presentation:
Alok Deora — Analyst
So good afternoon, everyone, and welcome to the interaction with the management of Zurat Express. So firstly, I would like to thank the management for giving us the opportunity to host the call. So today, we have with us Ms Sudhapai, CFO, Express; Mr Tushar, Head of Legal and Compliance and Company Secretary, Burard Express; and Mr Sagar Patel, Head of Corporate Accounts, Express.
So I would now hand over the call to the management team to provide some opening remarks on the performance and then we can start the Q&A session. Thank you and over to you, sir. Yeah.
Tushar Gunderia — Head of Legal & Compliance and Company Secretary
Thank you, Alok, and good afternoon, everybody. A warm welcome to all of you into the quarter three financial year ’24 earnings call of Ludat Express Limited. As you are aware, the Board of Directors of the company approved the 3rd-quarter financial results in its meeting on 29 January 2025 and the company declared its financial results for the quarter and nine months ended 31st December ’24, while the company posted profit-after-tax of INR791 million for the quarter ended, 31 December 2024.
Revenue from operations for the quarter stood at 15,117 million. Blue Dog, known for its exceptional service quality strengthened by advanced automation and technology remains a cornerstone for its operations, providing customers with a seamless workshop solution for all their logistics needs. The results are already uploaded on the stock exchanges in comparison with the provisions of and listing agreement provisions and also posted on website of the company. I now hand over the call to Pai, CFO; and to, Corporate Account for the. Thank you.
Sudha Pai — Group Chief Financial Officer
Thank you. So I mean, just to give a synopsis of Q3 as mentioned, our revenue has grown by 9.3% or and is at INR51.7 million and our profit before-tax, profit before-tax is at INR1064 million versus INR10.0 billion last quarter so yeah, with this open for questions.
Questions and Answers:
Alok Deora
Thank you so much. So any other hand question can please raise your hand or pose a question in the chat box below. Yeah, we’ll take the first question from Mr Krupa. Please go-ahead.
Unidentified Participant
Hi, good afternoon and thank you for the opportunity. Am I audible?
Sudha Pai
Yeah.
Unidentified Participant
So first up, just wanted to get a sense of what would be the tonnage for the quarter as well as the number of shipments carrying?
Sudha Pai
So in terms of tonnage growth, we have grown by 12% and we know shipment grown by 7.2% — 7.2%. In terms of absolute tonnagers, just a moment, no. Absolute tonnagers, yeah, for the quarter is 351 873 tonnes and shipment at 98.59 million.
Unidentified Participant
Thank you. So I just wanted to get a sense on the profitability improvement. And while we have seen that during this quarter, despite challenging environment, the crore revenue growth has been quite around 9%. Your thoughts around the further scale-up of the two new fleet, any updates on that and how that the underutilization, if there is any underutilization on the lag which we had highlighted in the previous calls, how is it progressing? Can you throw some light on that?
Sudha Pai
Yeah. So on the utilization now, now we would — you know it’s a — it’s a good news in this particular quarter is that we are — we are — we have reached at the optimal level of utilization. Yes, we do have a challenge of of the lanes on these new? However, it’s better than the previous quarter.
Unidentified Participant
Understood. So in this quarter, are you also seeing benefits of the APF price correction reflecting in your margins. Is that a booster or is it more of a pass-through which are already reflecting in your numbers?
Sudha Pai
Which you — question. Yes, I mean, it’s not a pure pass-through. We have our mechanism to you know, address this price increase and you know it gives a little bit of a margin as well. So it’s not a pure pass-through for the enterprises.
Unidentified Participant
Got it. Got it. Secondly on the recently commenced hub in — and congrats on that. I think globally the DHL team also commented about the aspiration to expand its India operations. Anything further you would like to add-on that particular of investments towards new capacities and what are your thoughts around both B2C and B2B?
Sudha Pai
So we are optimistic about improving our infrastructure of ground. Ground is where you know most of the growth happens. As I said again we are witnessing the ground more in both B2B as well as in the B2C segment, right? And the investment would continue to be there. That’s the outlook as far as our investment is concerned.
Unidentified Participant
Yeah. So while you highlighted it, there were specific target stated that e-commerce, you’re targeting about 25% market-share. So just something more on what are the steps taken towards achieving this market-share target. Anything which you can highlight at the moment?
Sudha Pai
So our aim is to have a structured investment which takes care of our profitable growth. And for us, definitely increasing our market-share those aspects are equally important, but we ensure that we have a profitable growth. So that’s the one that continues to be on our outlook as-is now stay of the cost.
Unidentified Participant
So any number perhaps on what you would be spending on infrastructure going ahead? Any outlines
Sudha Pai
So we personally do not give any forward-looking statement, but we would be releasing our budget assume and that would give an outlook about what we intend to spend over the next year you.
Unidentified Participant
All right. Thank you. I’ll get back-in the queue. Thank you.
Alok Deora
Thank you. We’ll take our next question from Mr Ahmed. Please go-ahead
Unidentified Participant
Hi, good evening, everyone, and thanks for the opportunity. Just a couple of questions from my side. Sorry, I joined the call late, so maybe it might be a repetition. I just wanted to understand the price absorption part. Last-time you indicated that we have announced the hikes of 9% to 12% from January ’25. So just wanted to understand how do you see this — these hikes getting absorbed in the market since January month has already passed.
Sudha Pai
So you know about the price hikes which are — which are already in pipeline, you would get to know the confident numbers around it in most probably by — by the next quarter results, which is in the Q4, these are Q4 results that we would be publishing. But yeah, we are — we are intending that our have been effectively, you know take a — take a minus consumers.
Unidentified Participant
Okay. Ma’am also we saw that EBITDA margin was possibly the highest in this year so-far, I mean the 3/4. So just wanted to understand the key drivers of EBITDA margin in this quarter. Was it mix or was it anything to do with lesser competitive intensity or optimal utilization of fleet as you mentioned, what were the key drivers of it and whether these will be sustainable going ahead?
Sudha Pai
So driver was a is the festive one. It’s the festive quarter. That was the most key thing that happened to us in Q3 and that nobody happens in most of the countries. Apart from that, you know our utilization got included. This, this and you know again optimal, we are very optimal in terms of the cost. These are the factors which led to a better quarter this year in terms of EBITDA.
Unidentified Participant
Okay. One last one, if I may. What would the capex in Nine-Month FY ’25 on a consol basis and what is the target for the year?
Sudha Pai
I think when we reduced that we spent around INR622 million, you know as on INR624 million is the capex that we have spent or up to up to Jan to December or the calendar year up to Jan to December. That’s been our spend so-far. The budget being 12 74, we have spent only 50% of you know, the capex is that we had budgeted for — and largely into largely into the infrastructure, the spend is largely into the infrastructure.
Unidentified Participant
No, so that’s a considerable shortfall. Was it by design or it just happened that you didn’t see new opportunities or I mean, can you throw some more light on this, please?
Sudha Pai
Well, it’s a — it’s a combination of internal and external factors. Yes, we do ensure that we don’t — that we review our profitability and the future outlook and then spend it accordingly. And also externally, it depends upon finalization of the deals, which place which you know which territory we want to invest into. Those are the external factors as well as we know these internal factors are the one which you know lead to slightly bigger, I would say in terms of. See also if you look at the GDP per se, like it’s a bit muted for, you know for the next quarter.
And even compared to the last year, it is from 8.2%, it is somewhere at around 6.2 percentage. So that way we are very precarious in terms of growth in the entire capex and we look into ensuring that we have a profitable growth and again we already invested into two aircrafts, then one another you know the major hub that was recently that recently was made public. So that way we are very cautious in terms of our investments
Unidentified Participant
And as of now, do we have a target for CY25 that you can share?
Sudha Pai
We will be reducing our annual purchase very soon likely. So the targets on the capex and the top-line and EBIT would be soon published by next one before the next one
Unidentified Participant
Great ma’am thank you so much and all the best.
Tushar Gunderia
Yeah, but it will be our internal targets
Unidentified Participant
Sure. Got it.
Alok Deora
Thank you. Any question can please raise your hand or post in the chat box below. We’ll take next question from Mr. Please go-ahead.
Lokesh Maru
Hi, thanks, Anuk. So ma’am, from our just discussion with different D2C brands and channel states, it’s — they suggest that Blue has taken as has been — has become more competitive when it comes to e-commerce pricing, right? So is there any change in our approach or you know the way we are looking at e-commerce at this point, is it driving volumes or you know, just some color on how we are looking at it? And what has the change been for us? Yeah.
Tushar Gunderia
Be little louder,
Lokesh Maru
Hello.
Tushar Gunderia
Yeah, happy louder. Yeah.
Lokesh Maru
Yes. Sir, so my point was in discussions with different D2C brands and just basic channel, it suggest — this suggests that there has been — we have become — Ludat has become more competitive when it comes to pricing e-commerce deliveries, right? So just wanted some color on is it a just wanted to confirm, first of all, if there has been any change in approach or aggression in pricing and the way we are looking at this segment, you know
Sagar Patil
In terms of being more competitive, it’s not very much. Yeah, in e-commerce, it’s not in terms of of any dilution in the yields. What we covered earlier in earlier quarters as well, we have now — in last few years rather for last two or three years, we have been focusing on increasing the scale on-the-ground e-commerce. So that many times the customer may look for one or two days of dilution in the transit time and with us operating the product which is — which goes on a speed truck, the gap between AI and that plus in terms of service color, the transit times could be 1, 1.5 days, but in terms of the prices, it becomes very significant.
So we do have a — now a more complete we offer to the customers where based on their — based on their requirement, they can either choose to go for airport or for a dark plus mode. Both the products are with our focus continued on the profitability and even competitive, but at the same time also remain very, very positive, profitable, helping both good for ensuring share of wallet as well as customers who as per their requirement to choose from the two products.
Lokesh Maru
Understood. So Dart+ is something you’re seeing has been a game-changer for us in last two, three years. So, sir, could you help understand like some color on how has growth been just for e-commerce in last two, three years? I’m asking this question because when we look at just the large two platforms like Amazon and Flipkart, their growth has been high-single-digit. But since we at Blue Dirt deal with a wider booklet of customers here, right, including D2C brands. So if you could help understand two things. One is growth in this segment that we have witnessed and another, you know, what is our value — how does our pricing or value proposition differ from maybe the second-largest player or maybe from the market-leader in this space? Yeah, that’s all.
Sagar Patil
So in terms of the growth we have since the B2C as well as B2B products both here as well as ground are quite integrated on operations. We do not publish segmented results. However, we have been sharing that it is the B2C and within that also B2C on-ground, that has been a growth drive for last few quarters itself. And our dependence is not on very few customers. We have a good customer-base. So only where it makes sense for the customers possibly without diluting on our required profitability, we are able to provide to a wider range of customers not only for.
So from that point-of-view, we have been witnessing a very significant — sorry, consistent growth in the ground-based e-com products and I think we have not seen a great dilution in the growth rate so-far that we are not a very big player maybe in the overall scenario. Within that segment, there have been lot of either captive or dedicated players for that. But for us, we look at the very niche customer requirements over there and we continue to grow at consistent pace there.
Lokesh Maru
Sorry, last question, just on the value proposition side. I mean, what kind of premium do we charge if we compare to the you know, second guy on pricing in the market
Sagar Patil
As premium because it’s the differentiation, the service that the customers will pay a different price. So when you comparing like-to-like in terms of service it will do look at only from a pricing perspective. So our service quality standards that we maintain give certain internal KPIs that makes us kind of standing out. So we are not from that perspective, premiumly priced asset, but we don’t leave at that value for which we get the
Lokesh Maru
, sir. Understood. Thank you.
Alok Deora
Thank you. We’ll take the next question from Mr Anshul Agrawal. Please go-ahead.
Unidentified Participant
Hey, thank you, Alak for the opportunity. A couple of questions from my end. First, can you provide us some color about the growth that we have witnessed in volumes? Would this be primarily driven by surface versus air?
Sudha Pai
Yeah.
Unidentified Participant
Perfect. And secondly, if that is the case or in — on our margins, is surface particularly dilutive on our consol margins? Are our margins significantly different in surface and air is what I’m trying to understand.
Sagar Patil
Yeah. In terms of percentage, it won’t be that very significant. But here the base price would be different for a year and for a surface product. Again, as I said, we do have a former first mile, last mile and sometimes have mine between B2B and B2C. So when you talk about markets, it becomes a what allocation criteria to apply it. But then overall, we see consistent margins across the we may differentiate internally different allocation criteria to drive different products, but surface is not the reason for dilution. It has been last few quarters because of certain investments which have started materializing now with good capacity utilization. So surface is not the reason for any dilution in the margins
Unidentified Participant
Great. That helps. Just one last follow-up on this. So our internal targets or the targets that we had sort of given to the Street around our PBIT margins being around 8% to 9%, that will not be sort of diluted if we expand further in surface, right? If we see surface growing faster than air or a ground surface or our e-commerce surface product growing faster than the other products. Is my understanding correct?
Sagar Patil
Yeah, we would like to work towards that, though it is not a guidance, so that we are.
Unidentified Participant
Great. Many thanks. Very useful. Thank you.
Alok Deora
Thank you. And your question can please raise your hand or post in the chat box. So we need a couple of questions from the chat, sir. One is what was the proportion of ground versus air in this particular quarter?
Sudha Pai
It does not better ground versus their in terms of shipment rate or profitability or?
Alok Deora
Sure. Any mix on B2B and B2C in this quarter, if you can share that.
Sudha Pai
Yeah. B2B, you know, we have to investor growth of 6.8% versus the previous quarter. And B2C is 15.6% in terms of revenue versus the previous quarter. And likewise this in terms of weight, it’s 11.1% increase in the weight in day and 16.9% increase.
Alok Deora
Sure. And also since this quarter the margins have improved on a Q-o-Q basis, so now that the price hike impact will also start coming in the 4th-quarter, would directionally margins look up further in coming quarters.
Sudha Pai
That’s the intent we have to — last quarter Q3 was a festive quarter. We had certain we had certain — we had a peak season surcharge that was during the festive quarter, which helped us to as well as the margin. And in the Q4, it’s the GPI that should help us to regain the margins.
Alok Deora
We’ll take next question from Mr. Please go-ahead.
Unidentified Participant
Yeah, good evening, sir, man. Thank you for the opportunity. Ma’am, if I were to ask you, in terms of the surface versus air mix, is it fair to say that the mix-shift in last three, four years could have been say 10 to 15 percentage point or not really — that may not be the right understanding.
Sudha Pai
We can say that would be the same assumption,.
Unidentified Participant
That’s a fair assumption, right? And do you see the same continuing like you can expect a 10%, 15 percentage — percentage point shift over next, say, three to four years could that be the possibility basis on the kind of investments? Yeah.
Sudha Pai
Yeah. Why we do not make a much of a forward-looking straight-line, but our outlook is that the ground will grow in a double-digit versus air, which would be less than 1%.
Unidentified Participant
Okay. And in terms of the investments what you’ve made, is it possible to get some sense out of our total asset, how much would be for air specifically? Like what kind of asset turns are you seeing in case of air versus surface? So even if the margins could be slightly different for surface, the ROCs are you know even superior or similar
Sudha Pai
One of the major investment was into aircraft that’s still being the second investment it was in IT and that’s across the product-line. That’s an enhancement to our software or you will do the transparency and we do. That’s across the product. And the last one is you put the bridge versal one. We are talking product is on the which takes care of air as well as the ground product or ground speed product as well that. So it’s a mix impacting the — the last one is mix impacting ground
Unidentified Participant
Right. Ma’am, is it possible to get a sense in terms of, you know, the number of hubs or number of branches what we have, what kind of expansion we have seen in last four, five years and if possible, even any sense about the direction from here on.
Sudha Pai
We don’t have that data readily as of now. But we’ll check legal thing if we can make it available for the public this thing and we’ll get back here.
Unidentified Participant
Sure. Just last question, if I may, ma’am. No, if we look at — like you mentioned, 3Q had a benefit of the festive, you know, the premium. But if you look at the gross margin, they are actually lower, but I presume it’s a function of the — it’s a function of the mix as well. So in terms of the focus, is it fair to say that we will — we will try to maintain margin and get more-and-more growth or we want to kind of focus more on the growth even if the margins could get somewhat impacted in the near-term.
Sudha Pai
So margins also what impacted this particular quarter and compared to previous quarter driven by the investments driven by the investment, the three major investment which we normally keep on talking about it and at least from the past 3/4 and I hope to know it will be increase in the upcoming quarters. So with every — with the investment that we would do, certainly it will take a little bit of a toll on the margins, but you know it will — it will help us to structure ourselves well for the upcoming coming growth that we envisaged.
Unidentified Participant
Right. Is it possible to get some sense about the capacity utilization land for air and surface?
Sudha Pai
For surface you know is for will be used trucks and those are like very well utilized. So there is no utilization challenge as such. We participate from a bit of a challenge in terms of having optimum utilization of our airplace from in the last quarter of the last year and beginning two quarters led. As of now, you know we are comfortable to say that about in our air fleet utilization is at an optimum level. Yes, there are certain ways where we need to work, but at this point in time for this particular quarter, it’s reasonable to say that we are that.
Unidentified Participant
And with the 5%, let’s say, for the sake of argument if the 5% kind of a growth in the air cargo, you know, how soon would you require to add another aircraft?
Sudha Pai
Depends like depends nothing or no comments on that as of it.
Unidentified Participant
Understood. Understood. And just ma’am, last question, sorry, if I may, with respect to the industry mix, is it possible to get some sense in terms of the in terms of the total revenue, how the different industries like pharma or industrial or consumer or you know, B2C, if you could give some sense what is the mix maybe of FY ’24 would also do just to understand the composition of revenue for different — for different sectors.
Sudha Pai
Sector sector, we don’t have
Sagar Patil
Business sensitive information.
Sudha Pai
Yeah. And to your question,, on the 5% one, when you say that with a 5% increase in air, would we add a new aircraft? I think it also depends on which sector and which rates this growth happens or which geography this region happen, this growth happens like. But — and as of now for this level of growth, I think our current rates are 0.2 well enough to take care of the world the? No,
Unidentified Participant
Understood. Ma’am, would it be possible to tell us…
Alok Deora
Yeah, sorry question now.. We’ll take next question from Mr Gaurov or please go-ahead.
Unidentified Participant
Yeah, thank you for taking my question. I just have one clarification question. In all the management guidance, will we talk about margins, can you clarify which margin do you talk about? Is it a standalone or consolidated? Is it EBITDA, EBIT or PBT? I just needed a bit clarification on this. Sorry and is it a margin standalone margin or the consol margin?
Sudha Pai
It’s a consol margin.
Sagar Patil
Yeah, there was no big figure. Gap between the that was such a year. We normally talk about it absolutely.
Unidentified Participant
Okay, understood. Understood. Thank you. Thank you. That was my only question.
Sudha Pai
Yeah.
Alok Deora
Thank you. We’ll take some questions from the chat. So what was the peak season surcharge during the 3rd quarter?
Sudha Pai
Peak season surcharge like you mean in terms of in terms of understanding what it is for?
Alok Deora
Yeah, yeah, basically — yeah, yeah. The festive season surcharge or some premium which you charge will led to the higher-margin in 3rd-quarter.
Sudha Pai
It’s a bit price-sensitive information and all provides an outlook that it’s a festive related phenomenon which we during festive season and once festive seasons are done, these are rolled back.
Alok Deora
Sure. And also one further question is on the growth outlook, while not really on the number side, but directionally, what is the growth outlook shaping up for FY ’26 and ’27 because it’s been a pretty — you know, last few quarters have been pretty muted in terms of growth for the industry. So how are things looking up because some players have also you know, been vocal about that it is very difficult to even take a price hike in the current scenario. So just your thoughts on what lies ahead for FY ’26 in terms of volume growth as well as pricing growth.
Sudha Pai
So don’t give any forward-looking statements so
Alok Deora
Yeah, actually it was — yes. So actually it was — as I mentioned, it was not about numbers, but how do we see the growth shaping up? I mean in terms of whether price realization price increase would go through and how the volumes could come up. That was basically the question.
Sudha Pai
Yeah. So actually, it depends on multiple factors. One of the crucial being the domestic demand and our GDP growth and also then depending on the segments, B2B2C or air versus grant and so on. But overall like our outlook remains to be, you know, to grow profitably, we do not have percent like an ambitious growth or targets from growing in a double-digit or 25% and so on. We want to keep it, you know to have a very consistent growth year-on-year as has been the style from past several years and would like to go into a similar run-rate.
Alok Deora
I think there is just one more question in the chat box, and I think if there are no further questions after that, we can close the call. The last question is on the competitive intensity, which has been there in the market. If you can highlight on that because the volumes have been pretty low at the industry level. So the competition is also pretty high. So just wanted — so the question was regarding the — what could be the impact of that and how do you see the competitive intensity shaping ahead?
Sudha Pai
We do face a competition, particularly on-the-ground, you know where where, where you know we have competitors like Delhi, Safe express and you know know those competing with us on-the-ground park. On the air with the growing, how to say that multiple with the availability of the commercial airline space and so on, like you know, we do — we do face a — we do face a no constraint there, but then ultimately for us, it’s the service politics, our service quality that helps us to — is being a very differentiating factor perhaps that’s the reason we are still able to post a consisterable stable-growth as well as profitable growth versus any of our?
Alok Deora
Sure. I think we have completely run-out of time now and there are no further questions. Just I think one last question we’ll take and then we can close the call. Yeah, please go-ahead.
Unidentified Participant
Hi, Rajasri. So just — I joined the call a little late. Just wanted to know the actual — the volume number in tonnage and in shipments, if you could mention that please?
Sudha Pai
Or you are talking about for the — for the April to December — April to December, right?
Unidentified Participant
So I’m talking about the 3rd-quarter, this quarter.
Sudha Pai
Per quarter.
Sagar Patil
So we had 98.59 million shipments and 351-873 plus
Unidentified Participant
Thank you
Alok Deora
So that’s the end-of-the call now. So I’ll transfer the call to the management for any closing comments.
Tushar Gunderia
Yeah so management comments, I mean, we are doing consistently well and improved performance.
Sudha Pai
Yeah,
Tushar Gunderia
Management is geared to do what the best measures are required for improved performance of the and it all depends on the economic outlook going-forward.
Alok Deora
Thank you. Thanks everyone for joining in and thank you.
Tushar Gunderia
Thank you so much for. Thank you all