Blue Dart’s Performance Affected By Slowdown, Says CFO 

Blue Dart Express Ltd.’s financials for the three months through September were hurt by a weakening economy and a fixed cost model, its Chief Financial Officer Aneel Gambhir said.

“The slowdown in economy has been impacting us, more so for our fixed-cost model,” Gambhir told BloombergQuint in an interview. A revival in the economy could improve the air and ground business of the logistics company, he said. “Definitely, air will grow at a slower pace than ground because of improvement in infrastructure. We are focusing on growing ground business as well.”

According to Bloomberg estimates, the Indian economy will slow for the fourth consecutive year in 2019-20, with GDP growth pegged at 6.2 percent in the current fiscal. At these levels, the Indian economy has seen growth slow by nearly 2 percentage points since 2016-17, when GDP grew at 8.2 percent.

The logistics company posted weak results in the quarter ended September with Ebitda plunging 22 percent year-on-year and net income falling 40 percent year-on-year (excluding Ind AS 116 accounting impact), a note by Edelweiss Research read. “Profitability (ex Ind AS 116 EBITDA margin) has been poor for five–six quarters at 4-5 percent compared with 9-10 percent historically,” the note read.

Watch the full video here: