According to an exclusive interview with NDTV Profit, Delhivery CEO Sahil Barua emphasized that the company's low-cost service provider model creates insurmountable barriers for in-house logistics arms. Barua stated that Delhivery's reach across India further strengthens its competitive position against captive delivery networks built by e-commerce players. The CEO highlighted that only three large captive logistics arms exist in India, and their design limits them to serving specific company needs rather than broader market requirements.
As reported by NDTV Profit, Barua estimated that e-commerce parcel logistics accounts for less than 10% of India's $140 billion logistics market. This market share reinforces Delhivery's strategy of expanding beyond parcel delivery into freight, warehousing and technology services. The CEO noted that it's very difficult to design processes and systems to serve unique and small needs, pointing to sellers on platforms such as Shopify who require third-party logistics support. Recent industry data shows that 55% of retailers now use carriers outside FedEx, UPS and the US Postal Service, with more than a third actively shifting volume away from these traditional carriers.
According to the NDTV Profit interview, nearly all of Delhivery's freight contracts are protected against fuel price inflation, with Barua estimating that less than 100% of all contracts are covered for fuel price inflation. While acknowledging a near-term timing lag as pricing adjusts to index-linked freight contracts over the first two quarters, Barua ruled out any lasting margin impact. The company has also cut fuel exposure by deploying larger, more fuel-efficient line-haul trucks and expanding its electric vehicle fleet, which grew five to six times over the past six months since the fuel price shock began. Recent industry data shows that ground fuel surcharges grew 26% year-over-year while tracked diesel prices rose 4.7%.
As reported by NDTV Profit, Barua stated that an inflationary environment strengthens Delhivery's competitive position over the medium and long-term. He cited the company's relatively lower cost base and greater ability to absorb price pressures compared with smaller operators. The CEO emphasized that Delhivery's competitive advantage lies in its lowest cost service provider status in the market, which makes it impossible for in-house logistics arms to compete on price even as e-commerce players increasingly build captive delivery networks. Recent industry trends show that 83% of executives reported per-package costs rising year-over-year, highlighting the importance of cost-effective logistics solutions.
