The 11-Quarter Streak Ends: Inside Mahindra Logistics’ Path Back to Profit

Mahindra Logistics Ltd. has reached what its leadership calls an "inflection point," reporting its first profitable quarter in nearly three years. The company posted revenue of Rs 1,898 crore for the third quarter of fiscal 2026, a 19% increase compared to the same period last year.

The results mark a decisive end to a challenging 11-quarter period of losses. Group CEO and MD Dr. Anish Shah characterized the results as a breakout performance, noting that the business is now "structurally profitable" after correcting previous weaker execution.

A Disciplined Execution
The turnaround was not a result of market tailwinds alone but followed a rigorous internal restructuring. During Mahindra Logistics' Q3FY26 post results conference call with the analysts, CEO and MD Hemant Sikka, stated that the company remains focused on stabilizing leadership and instilling execution rigor at the ground level.

The company took a step of stepping away from non-profitable relationships and renegotiating contracts to reflect the true value of its services. “Scaling profitability remains our most important near-term priority,” Sikka told investors.

A significant contributor to this recovery was the stabilization of the Rivigo B2B Express business (the segment that handles fast, scheduled shipments between businesses). This unit saw a 19% volume uptick and a gross margin expansion from 0.2% to 2.4% year-over-year, driven by improved lane utilization, the industry term for ensuring trucks are as full as possible on their routes.

The Gravity of the Mahindra Ecosystem
Mahindra Logistics remains deeply integrated with its parent company, the Mahindra & Mahindra (M&M) Group. Currently, 58% of the company’s total revenue is derived from M&M entities, up slightly from previous years.

This relationship provides a stable floor for growth, particularly as M&M continues to dominate the SUV and tractor markets. "There is no doubt that the growth of the Mahindra business does help us," CFO Isha Dalal noted during the analyst call, acknowledging that the logistics arm do benefits from the parent's strong volume performance in the automotive and farm sectors.

The company’s revenue remains heavily weighted toward the automotive industry. Auto-related business accounts for 62% of revenue, while non-auto sectors including e-commerce, manufacturing, and consumer goods make up the remaining 38%

The Automotive Tailbeat
From the perspective of the broader automotive industry, Mahindra Logistics’ recovery mirrors the current boom in Indian utility vehicles and a revival in Light Commercial Vehicles (LCVs), which saw 20% growth this quarter. However, the logistics provider is also grappling with white space, the unused capacity or inefficiencies in the supply chain. Management has committed to a glide path to eliminate 95% of this white space by September 2026 to further bolster margins.

While the 3PL (Third-Party Logistics) and freight forwarding segments showed double-digit growth, the last mile delivery segment, the final stage of delivering a package to a consumer's door remains a challenge. Management cited intense pricing pressure in this segment, describing it as a zero-entry business where low-cost competitors keep margins razor-thin.

Way Forward
Mahindra Logistics appears to have successfully traded aggressive, unhedged expansion for a more sober, margin-focused model. While the heavy reliance on its parent company remains a double-edged sword, the stabilization of its external business now 42% of the mix suggests a growing ability to compete on its own merits in an increasingly sophisticated Indian logistics market.