Decoding Shadowfax’s 5X Profit Surge

Shadowfax's operating leverage is now coming into play even as it eyes a bigger piece of the same-day and express delivery boom in the D2C segment

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India’s logistics market is quietly fragmenting. Ever since the ecommerce boom of 2015-2016, scale in delivery was built around one idea: move as many parcels as possible for large marketplaces, as cheaply as possible.

Volume was king. Margins were secondary. Most players optimised for throughput, not experience. That’s changing now with operating leverage coming into play for many of the players.

As in the case of Shadowfax, which is finally seeing the results of years of building up the network, logistics tech backend and infrastructure, all critical aspects in unlocking profitability.

As in the case of Shadowfax, which is finally seeing the results of years of building up the network, logistics tech backend and infrastructure, all critical aspects in unlocking profitability.

After years of operating as a marketplace-first logistics partner, the publicly listed company is now eyeing new growth frontiers. The company believes that its next phase will not just be about bulk ecommerce deliveries, it will come from same-day delivery, D2C brands, and hyperlocal commerce.

In its recent earnings call, management said: “ShadowFax Prime is now our fastest-growing vertical. Two years ago our D2C share was negligible. Today, we’re already in the early teens in terms of the growth percentage and still accelerating.”

Essentially, Shadowfax wants to move downstream: closer to brands, closer to sellers, and closer to consumers. It wants to become India’s D2C-first logistics platform.

And that makes sense given the company’s past investments in setting up the network and the........

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