MAHINDRA LOGISTICS LTD (NSE: MAHLOG) Q3 2026 Earnings Call dated Jan. 28, 2026
Corporate Participants:
Hemant Sikka — Managing Director & Chief Executive Officer
Isha Dalal — Chief Financial Officer
Analysts:
Unidentified Participant
Mandar Chavan — Analyst
Alok Deora — Analyst
Krupashankar — Analyst
Jinesh Joshi — Analyst
Achal Lohade — Analyst
Vikram Suryavanshi — Analyst
Vineet Khatri — Analyst
Disha — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to the Mahindra Logistics Limited Q3 and 9 months FY26 earnings conference call. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing Star then zero on your touch tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Mandar Chawan from SGA. Thank you. And over to you sir.
Mandar Chavan — Analyst
Thank you Uda. Good afternoon everyone and thank you for joining us for Mahindra Logistics Limited Q3 and 9 month earnings conference conference call. We are pleased to have with us today Mr. Heman Sikha, our Managing Director and CEO Ms. Isha Dharal, CFO along with the members of the senior management team. I hope everyone had a chance to view our financial results and invest the presentation which were recently posted on the company’s website and stock exchanges. We will begin the call with the opening remarks from management followed by an open forum for question and answer. Before we begin, I would like to point out that some of the statements made during today’s call may be forward looking.
A disclaimer to that effect was included in the earnings presentation. I would like to invite Mr. Sikka to share his remarks.
Hemant Sikka — Managing Director & Chief Executive Officer
Thank you so much Mandar. Good afternoon everybody and a very happy new Year to you. This quarter marks an important inflection point for Mahindra Logistics. After 11 consecutive quarters of losses, we have turned profitable. A milestone that reflects the decisive actions we took over the past few months. These actions are now visible in our operating outcomes with measurable improvement by sharper execution, tighter cost management and a more disciplined approach to growth. I must say that while we are still early in this journey, the momentum is clear and we are committed to building on it sustainably.
A key enabler of this progress has been the stabilization of our leadership and operating teams. We have strengthened alignment across functions, clarified ownership at the ground level and reestablish execution rigor across regions and business lines. This has led to faster decision making, more consistent operations and stronger customer responsiveness. With a stable and aligned team in place, we are not shifting our focus to driving sustained performance improvement. Scaling profitability remains our most important near term priority. During the quarter we reinforced pricing discipline, enhanced contract renewals and sharpened customer level profitability management. We also choose to step away from a few non profitable relationships and and recalibrated several engagements to reflect the true value of the services that we offer to our customers.
These actions are already visible in sequential margin improvement with further upside as ongoing discussions and cost efficiencies flow through. Let me now turn to a few specific business updates. Let me start with MSPL Rivigo, our B2B express logistics services. We saw an uptick of 19% in quarter three volumes YoY while maintaining stable yields level. Our gross margin also expanded from 0.2% in quarter three to 2.4% in quarter three. This is clearly the manifestation of the multiple initiatives under execution resulting in improved service levels for our customers, boosted lane utilization and improved unit economics. This gives us confidence that the foundation of the business is only getting stronger and we are well positioned for meaningfully scaling this business up.
In our 3 PL business, Q3 revenue grew by 20% YoY and our gross margins grew by 27%, a clear indication that our focus on operational efficiencies, rigor and profitable customers is working. Also, we are selectively expanding our own fleet as we see a clear demand on specific lanes. This is in line with our disciplined approach to capital investments based on utilization yields and our return metrics on the white space opportunities we had highlighted earlier. The execution remains firmly on track. We expect the impact of our actions to become more visible over the next three quarters, but let me reiterate that we remain fully committed to our glide path to almost eliminating our white space.
By September 26th. In our freight forwarding business, Q3 revenue grew by 33% YoY and our gross margins grew by 36% YoY, driven primarily by improved trade flows, operating leverage and a diversified customer base. I must add here that this is in spite of huge global uncertainties across the trade lanes. This reinforces our view that the business provides a very steady base for improving profitability potential as the volumes grow further from here. In our mobility business, Q3 revenue grew by 38% YoY and the gross margins grew by 18% y o y our focus here is on improving the utilization levels for the asset heavy part of our business.
Elide. You know that we have launched a new brand into our premium B2B offering as part of this business and we are calibrating our fleet expansion strategy based on the strong return thresholds that we are seeing in our last mile delivery business revenue and gross margin declined due to pricing pressures and strategic decisions at certain sites. We are in active discussions with our customer and expect profitability to improve from quarter four onwards. At the same time, our focus on operations excellence continues to be recognized during the festive peak. We won multiple accolades and rewards from leading e Commerce players including the best quality delivery partner in North India, the best performance and east and south from another client and similarly our portfolio.
We have received awards for ESG Leadership, Safety Performance from the National Safety Council of India and Supply chain resilience during the festive season with the debt being paid through rights issue, our interest costs have reduced materially strengthening our profitability profile. Further, we continue to closely monitor our working capital requirements. Now let me share my view on the broader industry trends. The festive quarter saw a clear uplift in demand across key sectors supported by festive consumption, GST related effects and improved microstability. While the recovery has been uneven across categories, the underlying momentum strengthened meaningfully versus the first half of the year in logistics.
Execution, rigor, supply chain preparedness and having the right set of customers have become clear differentiators and we continue to focus on this. In Express logistics the industry focus is shifting from aggressive expansion to consolidation and improved asset utilization signaling a more mature and sustainable phase of growth for the industry. Despite global uncertainties, the overall outlook remains positive and and has strengthened over the last quarter. So in conclusion I want to emphasize that the transformation momentum in Mahindra Logistics is real and accelerating. Our pipeline is healthy, our execution engine sharper and our internal performance framework far more outcomes driven than ever before.
More importantly, our confidence is grounded not in intent but in actual delivery in the progress we are already seeing on the ground. With that I would like to invite Isha our CFO to take you through the financials. Isha, please.
Isha Dalal — Chief Financial Officer
Thank you. Hemant, Let me now give a brief on the consolidated financial performance for Q3 and 9 months of F26. Our revenue for Q3 has increased by 19% on a year on year basis to 1,898 crores. This has been driven by strong volume growth, particularly in our auto and farm business which caters to M and M and across our express, mobility and freight businesses. The revenue from our warehousing Segment stood at 345 crores in Q3F 26 as compared to 300 crores in Q3F 25, up by approximately 15%. Our revenue mix between supply chain management which includes our three PL and network services business and the mobility business remains in line with historical Trends.
SCM contributes 94% of our overall revenue and the Mobility business has contributed 6% for Q3F26. We have seen a significant consolidated gross margin expansion of 76bps at the consolidated level with GM now at 10% in quarter three compared to 9.2% in quarter three F25. Scaling profitably remains our most important near term priority as Hemant has already called out and our discipline on pricing, contract selection and renewal and profitability management is reflecting in this margin improvement across several business segments. The year on year margin expansion is driven by enhanced profitability in key 3PI segments and in the turnaround journey of MESPL which has improved Gross margin by 7.2 crores year on year.
This consolidated gross margin improvement has also resulted in an improvement in EBITDA which has grown at 40% year on year to 102.8 crores up from 74 crores in Q3F25. Our reported PAT for the quarter stands at 3.3 crores. However operational PAT is 9.2 crore rupees after removing the tax adjusted Impact of Exceptional Items as you are all aware, in accordance with the new labor Codes, the Company has currently estimated the incremental impact on retireal benefits to be 7.36 crores in the consolidated results and 4.76 crores in the standalone financial results which has been presented under Exceptional Items.
It is the impact of this item that I am adjusting while calling out the operational path for the quarter on a standalone basis. We had no debt for 31st December and our consolidated gross debt stands at 64 crores. Moving on to segment performance in the 3Ps segment our revenue for the quarter was 1502 crores as compared to 1255crores in Q3F25 which is up by 20%. This as I mentioned earlier is led by strong growth in the AFS segment followed by the consumer business. Our gross margin for quarter three was 165 crores as compared to 130 crores in Q3F25 which is a growth of 27%.
In 3PL, our freight forwarding business clocked a revenue of 94.8 crores as compared to 71.5 crores in Q3F25 up by 33% led largely by volume growth across ocean and air. Our reported PAT in this business was 2.4 crores. Again the operational PAT adjusted for labour code impact is 2.8 crores as compared to 1 and a half crores in Q3F25. In our Express business which is MESPL, our Q3F26 revenue was 113.6 crores as compared to 89.1 crores in Q3F25 up by 27.5% in this business we have witnessed a 19% year on year growth in delivered volumes along with steady yields resulting resulting out of multiple actions that we have taken.
Volume, leverage and scale have resulted in a corresponding increase in unit economics which you will see reflected in the gross margin improvement that I called out earlier. The reported PAT loss in this entity stands at 15.5 crore rupees. Again operational PAT loss is 14.5 crore rupees in the third quarter. In our mobility business this business has had a very good quarter driven largely by momentum. In the B2B part of the business. The revenue for Q3F 26 was 110.7 crores as compared to 78.1 crore rupees in Q3F 25 up by almost 42%. Reported PAT in this business was 1.3 crores and operational PAT was 2 crores versus 0.8 crores in Q3F 25.
Our last mile business has a Q3F 26 revenue of 82 crore rupees as compared to 103 crores in Q3F 25. The GM has also declined from 7.3 crores in Q3 of 25 to 2.7 crores in Q3 of 26. As Hemant mentioned last time as well as earlier, we have taken some strategic calls in this business and exited customers or sites that remain unviable. For us. This has led to a decline in revenue and in margins in the near term. This is an operationally complex business and while the rate pressure continues in the near term with the sustained efforts on rate renegotiation and operational excellence, we expect business performance to witness steady improvement in this segment.
Coming to the revenue breakup for the quarter, auto business contributes 62% of the revenue and the non auto business contributes 38%. The Mahindra business contributes 58% to our top line and the non Mahindra Business contributes 42%. That brings me to the end of my prepared remarks and I now open the floor for question and answer.
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press Star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Alok Deodora from Motilal Oswal. Please go ahead.
Alok Deora — Analyst
Good afternoon just and congratulations on good number. Just had a Couple of questions. So first is on the express business we saw very strong traction there be it yoy or even as against the second quarter. So just wanted to understand how what led to these kind this kind of volume growth which we have not seen since the longest time. And also was it like because of the GST rate cut we saw some bump up in volume which may not sustain ahead any color on that? That’s the first question. Second question is that you know despite such high volume growth and revenues in this on in a quarterly basis the EBITDA really has not moved much.
So when can we really expect the breakeven to happen here? I mean what kind of volumes you would require for that? Yeah, that would be.
Hemant Sikka — Managing Director & Chief Executive Officer
Thank you Alok. So let me answer the second part first. As you have seen that in the quarter two, which was quarter two of this financial year we had just turned kind of positive on gross margin. This time we have further upped the gross margin from let’s say 20 lakh to about 2.4 crore in quarter three. Further we feel that the actions that we are taking on the ground which is in terms of driving more volumes, putting more feet on street, maintaining a high net service levels, better engagement with our clients, making sure that our lane utilization both for volume and weight remain at a very healthy level, ensuring that the backward lane consolidation is again done with various verticals within mll.
So all these are levers that the team is really focusing hard and making sure that we execute a very tight game on this. This is leading to better gross margin and better EBITDA performance. As you have seen from quarter two to quarter three. We are I would say not achieved EBITDA positive in this quarter. But I can just tell you that we don’t give a guidance but we are very close to a beta break even level.
Alok Deora — Analyst
Sure. Just on the first question on the volume, what really happened in this quarter?
Hemant Sikka — Managing Director & Chief Executive Officer
So volume is better execution. We have engaged with our customers in a more holistic manner. We have internal dashboards that we are now monitoring at a daily basis. There is a very strong rigor which is happening. Our NFL has actually improved month on month. So that is also giving better customer satisfaction. So I would say it is multiple levers which are all standard first principle levers of any business that you execute very well, you satisfy your customers well, make sure you run a tight shift and that is what is leading us to I mean get win more and more businesses from our customers.
I think that this volume is sustainable and we should in fact do better from here.
Alok Deora — Analyst
Got it. So it was not really the one off, you know, deferred demand in October. It’s more. You’re saying it’s more a stabilized quarter only. And we would have done a similar run rate in January also without the numbers.
Hemant Sikka — Managing Director & Chief Executive Officer
Look, the business varies from quarter to quarter because the whole GDP varies from quarter to quarter. Quarter three is always a high intensity quarter for us. Quarter four is also a good quarter. But I would say that you can’t like take one quarter and multiply by four. But it is. I mean there is some variability in quarter to quarter. All I can tell you is that we are winning customers, we are executing well and that gives us confidence that we should be able to do better from here.
Alok Deora — Analyst
Sure. Yeah. That’s all from my side. I’ll come back in the queue if I have more. Thank you sir. All the best.
Hemant Sikka — Managing Director & Chief Executive Officer
Thanks Anuk.
operator
Thank you. The next question is from the line of Krupa Shankar from Avendes Park. Please go ahead.
Krupashankar — Analyst
Hi, good afternoon and thank you for the opportunity. Congrats on great set of numbers. My first question will be on a clarification. You did mention that the Mahindra group contribution this quarter was about 58%. What was it last year? At the same period.
Isha Dalal — Chief Financial Officer
It would have been in a similar range, maybe slightly lower than that. So it has gone up slightly this quarter.
Krupashankar — Analyst
Just why I’m trying to build on it is because we did see a very strong growth in the 3 PL business. Just wanted to get a sense on whether the growth is coming in primarily from Mahindra and the auto piece picking up materially or have you seen some traction around other sectors as well? You can throw some light around that please.
Isha Dalal — Chief Financial Officer
Yes, sure. So there is no doubt that the volume growth in the M and M business and everybody knows the volume growth there that is also publicly disclosed does help our business as well since we do service the Mahindra and Mahindra auto and farm business. So yes, that has contributed to the strong growth. But there is also a growth in the other verticals. As I called out in my remarks, we don’t disclose the growth segment by segment at a 3 PL level. But I can tell you that we are adding customers and as Heman said, executing well and growing across our various segments as well.
But yes, there is no doubt that the growth of the Mahindra business does help us.
Krupashankar — Analyst
Got it. And with respect to white space reduction, I think Hemant called out last quarter that There was a 20% reduction and this quarter. Any commentary around how much of white space Reduction have we seen? And of course your commentary on by reducing it by 95% by September 26th holds. Right? So some comments on that.
Hemant Sikka — Managing Director & Chief Executive Officer
Sukhrubha. I would suggest that we will not share how our reduction is going on because you would appreciate that any information like this leads to pricing pressure on us. But as I said in my opening remarks, we remain committed to reducing our white space by 95% by September. We are absolutely on track. In fact, we are slightly better on a glide path quarter on quarter on this. And you will. I mean this. We are committing that this will happen.
Krupashankar — Analyst
Got it? Understood. Last from my side of the express business. Now typically, you know, earlier it was communicated that there is a certain tonnage which was required to to achieve your your EBITDA break even or fat breakeven. Now, while the growth has been quite strong on the tonnage side of things, 19% YoY growth and you are on path. Is it possible to mention what would be the extent of further tonnage required for getting the maximum efficiency with respect to your gross profits or gross margins or what you are targeting?
Hemant Sikka — Managing Director & Chief Executive Officer
Agrabha, I would suggest that we think about this business turnaround not in tonnage terms at all. Let me tell you that I can pick as much tonnage as I want from the east of India if I just drop, let’s say three rupees a kg. Okay, I can pick as much tonnage as I want, but that doesn’t help the business overall. So I would suggest that we should think about this in terms of both tonnage and yield. I can tell you that while our tonnage has improved in this quarter, we have been able to maintain good yields and that is what is leading to this good performance financially.
I again reiterate that we are very focused on turning this business EBITDA positive and we are pretty close to it now.
Krupashankar — Analyst
Understood. Thank you for answering my questions.
operator
Thank you. Ladies and gentlemen, anyone who wishes to ask a question may press star N1 on their touchstone telephone. The next question is from the line of Jinesh Jochi from PL Capital. Please go ahead.
Jinesh Joshi — Analyst
Yeah, thanks for the opportunity. Sir. I just wanted one clarification. In the opening remarks you mentioned that in the B2B Express business our yields are steady. But if I look at the revenue growth, it was at about 30% and volumes were up by about 19% which essentially implies that yield growth was quite healthy. So if you can just clarify whether yields were steady or have we seen an improvement. Hello?
Isha Dalal — Chief Financial Officer
Yeah, could you repeat your question? Sorry, we didn’t catch that in the.
Jinesh Joshi — Analyst
Opening remarks, it was mentioned that in the B2B Express business yields were steady but volumes are up by about 19% whereas the growth in the express business is 30% which essentially implies that yield growth was quite healthy. So just wanted to clarify on that part.
Hemant Sikka — Managing Director & Chief Executive Officer
So Ginesh, clearly we have been able to grow the volumes on stable yield. We have obviously improved our yields over the quarters. But if you slice it specifically by quarter one, quarter two, quarter three, we may not be able to pinpoint a very big increase. But we would say steady increase. But in the previous quarters we had improved the yields and they are also coming into the overall calculation, if that answers your question. Isha, you want to come in?
Isha Dalal — Chief Financial Officer
Yeah, I also just want to clarify, also to clarify on this holding steady yield part. Our yield has been increasing versus last year year when we were pointing out stable yields, we were pointing out also stable yields sequentially versus the previous quarter, quarter 2. All right, so that’s not the right comparison.
Hemant Sikka — Managing Director & Chief Executive Officer
Did we answer, Janish?
Jinesh Joshi — Analyst
Yeah. Yes, yes. Yes sir. Yes sir, that, that answers my question, sir. My second question is that if you can clarify, does the group have any express business piece that is rooted through Rivigo and is it possible to share what proportion of that business is rooted in house versus that is being outsourced currently? Is it possible to share?
Hemant Sikka — Managing Director & Chief Executive Officer
So Ginesh, we do serve M and M and the group for express business. Of course we do serve but it is a small part of our overall business. I can say that.
Jinesh Joshi — Analyst
Possible to share any quantum in percentage term.
Hemant Sikka — Managing Director & Chief Executive Officer
Right now it’s almost very, very small.
Jinesh Joshi — Analyst
Got that. One last question from my side. It has been quite some time since we have announced our GV with Cino but I think there has been no traction on that side. So can you update about the latest progress over there?
Hemant Sikka — Managing Director & Chief Executive Officer
Yeah, we are just. Let me talk about Cino. So Sino is one of the most reputed logistics company from Japan and they have some very core multi decade relationships from some of the big Japanese name that we all know. We are very happy with this joint venture and we believe that this joint venture can really do very well in India. The team is now in place. We have a managing director which is nominated by Seno. We have a CFO from our side there and we are gradually scaling up this business. Right now we don’t see any material revenue in this business because with Japanese clients it takes a little longer life cycle to crack the deals.
But I can share with you that we are in active discussions with some very large Japanese companies in India and with the kind of relationship with Zeno brings in the kind of execution rigor which Mahindra Logistics bring in. I think we should be able to show some wins in the next year.
Jinesh Joshi — Analyst
Got it, sir. Thank you so much and all the best.
Hemant Sikka — Managing Director & Chief Executive Officer
Thank you.
operator
Thank you. The next question is from the line of Ancel Lohade from Nuama Wealth. Please go ahead.
Achal Lohade — Analyst
Yeah, congratulations first of all on great turnaround. Just couple of questions first, if you could, you know, give us some sense in terms of pricing scenario in 3 PL in Express. You know, one of the comment, Isha, I think you made was the yields are still under pressure. So just wanted to understand because some of the peers have taken price hikes or price increases. Just wanted to understand. And also Isha, you had mentioned in one of your remarks that we have let go certain business, if it’s possible to know any, any volume impact of that in that segment.
Hemant Sikka — Managing Director & Chief Executive Officer
Yeah. So let me answer the second part first. So all that volume impact is already subsumed in the results that we have shown you. So all the growth numbers that you see is in spite of us giving us certain businesses away. So it kind of like covers that up. In terms of pricing, I would say overall, since the economy is doing very well and we have have some very good customers and we are very happy that our customers wanted to do very well, we are not seeing any pricing pressure in terms of any downward pressure.
However, we are doing price corrections where we feel that our services are not appropriately priced. We are willing to give some businesses away and also renegotiate with our customers. However, in Last Mile, we continue to see pricing pressures. As you know, this is the last chain, the guy who brings the packet to your house. This is the toughest part of the business and it’s very difficult to kind of make meaningful profit in this. But we still continue to work very hard on this. I think our overall profitability on this part of the business has also improved and you will continue to see more improvements in quarter four and quarter one in the coming quarters.
So except for Last Mile, I don’t want to call out any other thing. I think our pricing is relatively very good. And wherever it is not good, we are engaging very, very positively with all our customers and having those negotiations and discussions.
Achal Lohade — Analyst
Sorry, just to extend to that question, sir, you know, in terms of this price correction, like are we broadly through or we are not even halfway mark in terms of price corrections across our customer base, I would say that we.
Hemant Sikka — Managing Director & Chief Executive Officer
Are halfway through, but there is still about half work yet to be done.
Achal Lohade — Analyst
Understood. And any, any, any sense you could provide with respect to margins. How do we see this on consolidate level? You know, do we see meaningful improvements soon or it will take probably six to eight quarters to really see a meaningful improvement at the EBITDA margin performance. If you could give any comment, I.
Hemant Sikka — Managing Director & Chief Executive Officer
Will request Isha to come in.
Isha Dalal — Chief Financial Officer
Yeah, so Achal, we don’t really provide guidance on margins but I will just reiterate what Heman said earlier that with all the actions that we are taking on cost interventions that aren’t appropriate, selection of customers, rate renegotiation and all our other actions on operating and financial discipline, we expect margin to keep extending, expanding in the near to medium term. That’s the only guidance I will give.
Achal Lohade — Analyst
Got it. Thank you. Those were my questions. I wish you all the best. Thank you.
Hemant Sikka — Managing Director & Chief Executive Officer
Thank you.
operator
Thank you. Ladies and gentlemen. Anyone who wishes to ask a question may press star N1 on their touchstone telephone. The next question is from the line of Vikram Suryamanshi from Philip Capital. Please go ahead.
Vikram Suryavanshi — Analyst
Yeah, good afternoon sir. I think some of the questions already answered but if you can give outlook on non Mahindra 3 PLP business which are the industries or sectors looking promising and any further scope to increase value added services in non Mahindra.
Hemant Sikka — Managing Director & Chief Executive Officer
Other than Mahindra for non Mahindra, I would say that all our verticals are doing very well. We continue to clock very good numbers on our E commerce business. We are similarly doing pretty pretty well on our manufacturing and consumer verticals. I think our deal pipeline is looking strong. Some of the conversions were expected to happen in quarter three. We’ve got a little delayed because these are very long term commitments. So we completely appreciate that our clients take a little longer to make the final decision. But we are in active discussions with many of our large clients in E Commerce, manufacturing, consumer mobility to kind of close these deals as fast as possible.
I can just say that we work with the best logos in the country and we have some very strong relationships with even with non Mahindra clients that we have.
Vikram Suryavanshi — Analyst
And just on challenges in last mile, is it like just a competition is a major challenge or are there any other challenges which can turn it around from our own business?
Hemant Sikka — Managing Director & Chief Executive Officer
Vikram, I would suggest that actually competition is not a challenge at all in this, in this the unit economics is the challenge. How do you serve your customers well and still make money? I think that is a challenge. The business is so much that our customers are repeatedly calling us and saying please take more business but we are being very, very choosy. And and politely refusing to our customers on sites which are not viable. So competition is not an issue here at all. It is the unit economics. Whether this business model has to mature. I think this is a business which Vikram, you would realize that it’s a zero entry business.
Anybody can do last mile packet delivery to a house. So it’s a zero entry. I mean business. Anybody can become a supplier. So that’s why the pricing continues to, to remain under pressure. Till the time client sees lot of difficulties with these people. They will not be coming to a well established player like ours. So when we come in, we solve all their problems. But we have to still compete on pricing. And that’s what we are trying to tell our customers that. I mean if you want to work with Mahindra Logistics and obviously our pricing will not be at the same threshold as some other guy is working for you.
So that is the kind of discussion we are continuing to have with our customers. Some of our customers have accepted our plea. Some of the customers will accept it maybe after few quarters.
Vikram Suryavanshi — Analyst
Understood? Yes. Thank you very much.
operator
Thank you. The next question is from the line of Vineet from Toro Wealth. Please go ahead.
Vineet Khatri — Analyst
Sir. My question was with respect to the. B2B business, I mean after the integration. Of SML Mahindra, I mean is there. Any impact on a volume growth that we see because of that particular integration from the Mahindra business standpoint?
Hemant Sikka — Managing Director & Chief Executive Officer
So we are very happy that this acquisition has been done by one of our largest customers. So we, we have started engagement with the team on the ground and we are very confident that going forward we will start winning business from them as well. So this is a good thing for us.
Vineet Khatri — Analyst
Okay. And like was there any impact in. Our Q3 performance with respect to this?
Hemant Sikka — Managing Director & Chief Executive Officer
Not yet. Not yet. We are, we have started work in Q3 because our solution is not that we will just do what other people were serving that company earlier. We want, want to add a lot of value to our clients. So that’s why we have to do complete network planning, network optimization, make sure that we put the right kind of value to our very large customers. So this is kind of work which currently our teams are doing. As we finish this work, then there will be pricing discussion with our client and then we will start.
So I think this should take about a quarter more.
Vineet Khatri — Analyst
Okay. And do we see it as a. Like a significant portion of our financial performance?
Hemant Sikka — Managing Director & Chief Executive Officer
I won’t call that out yet because we are very early stage of our discussion.
Vineet Khatri — Analyst
Understood. Thank you sir for taking my question.
Hemant Sikka — Managing Director & Chief Executive Officer
Thank you. Vinit.
operator
Thank you. The next question is from the line of Navneet, an individual investor. Please go ahead.
Unidentified Participant
Hi Mr. Sikha, this is Navneet. So my question is up until last year you had outlined the company had outlined a vision. You know, in terms of top line where it wanted to reach. Of course, you took over as a CEO just about seven, eight months back. That vision is not there currently in the presentation. So you know, with the new leadership team do you think you would be coming out with the vision statement on where you want to take the company in the medium term or in the long term?
Hemant Sikka — Managing Director & Chief Executive Officer
Absolutely, we will do that. So currently you know that we have been in a very strong turnaround execution phase over the last two and a half quarters. And now that we will stabilize this over the next couple of quarters so that you and all our investors get confidence that this performance is for real. And in the meantime we will start work on our long term vision which we will share with you in due course. But we are beginning to start at work.
Unidentified Participant
Okay, Just wanted to know that. Thank you so much and all the rest.
Hemant Sikka — Managing Director & Chief Executive Officer
Thanks Navit.
operator
Thank you. The next question is from the line of Krupa Shankar from Avendis Park. Please go ahead.
Krupashankar — Analyst
Yeah, thank you for the follow up. One question on the freight forwarding business. Just wanted to get a sense while growth has been quite strong this time around. Any one offs you want to call or are you seeing any improvement in freight forwarding ops on a whole? Because exim volume growth has not been as great as one would have anticipated. So something to call out over there.
Isha Dalal — Chief Financial Officer
There are no one offs in this business, Krupa. This is growth. The organic growth of the business that is coming out of volume growth of some of our key customers. So no one of that I would. Like to call out.
Krupashankar — Analyst
Got it. That was the only question for myself. Thanks.
Isha Dalal — Chief Financial Officer
Thank you.
operator
Thank you. Ladies and gentlemen. Anyone who wishes to ask a question may press star and one on the touchstone telephone. The next question is from the line of Pradeep Panchal, an individual investor. Please go ahead.
Unidentified Participant
Yeah. Hi. You mentioned there is 58% from Mahindra. So it’s 42%. Can you give some sector wide split like if it is still has a major auto. Right. Like from other companies. Then are we like a second proxy to auto sector performance?
Isha Dalal — Chief Financial Officer
Yeah. So 62% of our revenue does come from auto. Large part of that is Mahindra and some small part of it, you can do the math is from the other customers.
Hemant Sikka — Managing Director & Chief Executive Officer
I would just say it’s Auto and tractor and trucks and everything. So it’s like not only passenger car.
Isha Dalal — Chief Financial Officer
That’s right.
Hemant Sikka — Managing Director & Chief Executive Officer
But this includes the whole auto, tractors, truck, two wheelers, everything.
Isha Dalal — Chief Financial Officer
That’s right. That’s right. But no, as far as the other sectors or our exposure to other segments go grow, we go. We will not be providing that split. So it’s 62% auto and 38% non auto. And again auto includes all kinds of vehicles. Yeah.
Unidentified Participant
So like this is like a major proportion. Are we. Is there a plan to also include other sectors, not just other companies. You. Know, acquire when we are acquiring new customers?
Hemant Sikka — Managing Director & Chief Executive Officer
Yes, Pradeep, that’s one of our continuous work and that’s why we are focusing very strongly on our other verticals of E commerce where we continue to do very well on manufacturing and consumer. We are scaling that business up and you will see results in the next few quarters on both these verticals. So we continue to do. You have seen how mobility and freight forwarding have done well. So we are a fully integrated player and we don’t in our own working, never prioritize one sector over the other. We want to grow our business across all our verticals, across all our segments.
Unidentified Participant
Sure. Thank you.
Hemant Sikka — Managing Director & Chief Executive Officer
Thanks.
operator
Thank you. The next question is from the line of Disha from Sapphire Capital. Please go ahead. Hello. Yes, Disha, please go ahead.
Disha — Analyst
Yeah, am I audible?
Isha Dalal — Chief Financial Officer
Yes, audible loud and clear.
Disha — Analyst
Yeah. So you had mentioned in your commentary that we have to let go some some of the business because the margins were too low. So if you could just share what’s the minimum margin threshold we keep below. Which will be taking like orders. Kripa, that is internal to us and that is a threshold that we’d not like to
Isha Dalal — Chief Financial Officer
Disha. Sorry, that’s not an information we’d like to share publicly. But I can just tell you that every customer contract, every negotiation and every repricing goes through a very rigorous evaluation at our end we decide if it makes sense economically and strategically and make that decision.
Hemant Sikka — Managing Director & Chief Executive Officer
Also to add to what Isha said, Disha, I mean leaving a customer is never a happy decision for us and we really try our best to engage with the customers and have multiple rounds of discussions with them before we take that decision. It’s never an easy decision and it’s never a quick decision. So we are very mindful that we exist here to serve our customers.
Disha — Analyst
Okay, okay, fine, Fair enough. And my second question was, so you currently are auto and non. AutoBaker is around 62% versus 38% and. That we are building out these Manufacturing, consumer and E commerce segments will take a bit of time. But say one, two years down the line. How do we see this mix changing?
Hemant Sikka — Managing Director & Chief Executive Officer
We used to have a target internally, Disha, just to share that we should have so much of M and M, so much of Non M and M, so much of Auto. But then we realized that we are not able to control this at all. Because it depends on how well our customers are doing. We are very happy that both the large businesses of Mahindra, which is Auto and Tractor, is doing so well. So even though all other customers are doing well, but since Mahindra and Auto are hitting above the belt, obviously their percentage ratio in our business goes up.
So we continue to serve our customer to the best of our ability. Then it’s for customers, how they grow and then we grow with them.
Disha — Analyst
Okay. All right. Okay. That’s it. From my side. Thank you.
operator
Thank you, ladies and gentlemen. We will take that as the last question for today. I now hand the conference over to Mr. Heman Sikha, Managing Director and CEO for closing comments. Over to you, sir.
Hemant Sikka — Managing Director & Chief Executive Officer
Thank you. So friends, as we look ahead, our priorities remain clear and unwavering. And that is to drive profitable growth, improve customer satisfaction and continuously enhance the quality of our revenue base. Demand trends across our core sectors remain encouraging. And with a sharper execution framework and a disciplined capital approach, we believe we are well positioned to build on the momentum established in this quarter. Thank you so much for joining us today. We hope we have been able to address your questions and provide a clear view of our strategy and progress. If you have any further questions or need any additional information, please feel free to reach out to our team or to our investor relations advisors at sga.
Thank you all so much.
operator
Thank you. On behalf of Mahindra Logistics limited that concludes this conference. Thank you for joining us. And you may now disconnect your lines. Thank you.