India Intra-City Logistics Market - Growth, Trends, Covid-19 Impact, and Forecasts (2022 - 2027)

India Intra-city Logistics Market is Segmented by Service (Transportation, Warehousing and Distribution, and Value-added Services) and City (Delhi, Bangalore, Mumbai, Hyderabad, Chennai, and Kolkata).

Market Snapshot

India Intra-city Logistics Market Size
Study Period: 2018-2027
Base Year: 2021
CAGR: >5.3 %

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Market Overview

The Indian intra-city logistics market is expected to register a CAGR of more than 5.3% during the forecast period (2022-2027).

In India, the last-mile delivery sector is on an upward trend. Despite the country being under lockdown for the previous year, with only critical deliveries permitted, e-commerce shipments increased from 814 million in 2018 to 1.36 billion in 2020. It is estimated that intra-city logistics accounts for approximately 15-20% of the road transport industry.

The COVID-19 pandemic accelerated the widespread adoption of online services. Notably, small and medium firms, which form the backbone of the Indian economy, continue to have a minimal online presence. It is believed that just 20% of small firms presently offer online services, leaving a largely untapped market and limitless opportunities for the logistics sector to flourish. Intra-city logistics providers are becoming important for these small and medium-sized firms to cater to their customers.

Intra-city logistics providers, who typically deal with rapid and on-demand delivery requirements, are highly dedicated to assuring same-day deliveries. As a result, the entire chain of operations is subject to demand variability. Orders may suddenly rise from one area of the city, necessitating swift identification and connection with an available delivery person. Innovative technology is the foundation of a system that efficiently meets the needs of demand and supply to provide flawless function and resource optimization and positive unit economics.

Scope of the Report

Intra-city logistics is not just about delivering parcels in 30 minutes. It is about solving the business challenges that companies face and building capabilities to seamlessly execute any sort of goods movement irrespective of their scale and size.

A comprehensive background analysis of the Indian intra-city logistics market, this report covers the current market trends, restraints, technological updates, and detailed information on various segments and the industry’s competitive landscape. Furthermore, the Indian intra-city logistics market is segmented by service (transportation, warehousing and distribution, and value-added services) and city (Delhi, Bangalore, Mumbai, Hyderabad, Chennai, and Kolkata). The report offers size and forecasts for the Indian intra-city logistics market in value (USD billion) for all the above segments.

By Service
Warehousing and Distribution
Value-added Services
By City

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Key Market Trends

Demand for Intra-city Logistics from Tier-2 and Tier- 3 Cities Growing

E-commerce volume growth in India's tier-2 and tier-3 cities is surpassing growth in tier-1 cities. Smaller Indian cities now account for a greater proportion of e-commerce sales. E-commerce growth in India's tier-2 and tier-3 cities is surpassing that in the country's tier-1 cities. The volume share of these smaller cities in India's e-commerce sector climbed to 46% in Q4 CY20, up from 32% in Q4 CY19. Furthermore, online spending per customer in tier-2 and tier-3 cities has increased, with these cities accounting for 43% of e-commerce sales value in Q4 2020, with a Y-o-Y growth from 26%.

During the festival season, all major e-commerce brands saw a considerable increase in new clients from these cities. During its month-long festival sale in 2021, global e-commerce giant Amazon said that 79% of new buyers came from towns such as Ernakulam, Guntur, Krishna, Godavari, and others. During its month-long festival sale, value e-commerce giant Snapdeal reported a 91% increase in demand from tier-3 cities compared to 2020. The company also added that tier-3 cities accounted for 58% of all orders, while tier-2 and tier-1 cities accounted for 15% and 27%, respectively, of all orders.

Growing e-commerce demand in tier-2 and tier-3 markets has more than doubled income for intra-city logistic startups like LetsTransport and Cogos, who provide logistic fleet (trucks, three-wheelers, etc.) to companies like Amazon, Flipkart, Blinkit, and BigBasket. LetsTransport said that an increase in delivery to tier-2 and tier-3 markets contributed significantly to the company's growth. In 2020, the company's revenue increased by more than 2-3x, with tier-2 and tier-3 markets accounting for 50% of this increase.

Companies are capturing this opportunity by expanding their services in the country. For instance, in 2020, LetsTransport announced that it is planning to expand to approximately 35 more cities and grow by 150–200% next year. The company foresees increased demand from Tier-2 and Tier-3 cities in line with increased digital literacy and e-commerce expansion.

India Intra-city Logistics Market Trends

Demand From D2C Companies Driving Intra-city Logistics

The D2C model is becoming so popular in India that MamaEarth took only four years to generate an income of INR 100 crore, whereas globally recognized beauty firms have previously required 20 years. Companies such as Sugar and MamaEarth benefited greatly from the digital D2C model, which resulted in exponential development. Established FMCG brands such as Himalaya, ITC, Hindustan Unilever, and others are experiencing severe competition from D2C businesses, such as MamaEarth, Pee Safe, Moms Co., and others.

The holiday season is the most profitable time for small, medium, and large merchants to generate sales and the need to meet growing demand becomes more pressing. Because demand patterns are good and sellers are aware of the items that are certain to see increased customer demand, i.e., seasonal inventory, they concentrate their efforts primarily on segregating inventory for easy order pickup and delivery. Small D2C sellers may lack the resources to manage end-to-end operations on their own, so they turn to third-party logistics and fulfillment companies for effective order administration, streamlined operations, and flawless shipment last-mile delivery. “Last mile,” as the name suggests, refers to the final stage of delivery and continues to remain a challenge. This is where efficient intra-city logistics and last-mile delivery services are gaining prominence.

Owing to the widespread popularity of online shopping, 3PL aggregators in India have come a long way. The majority of these firms provide full-service logistics solutions, such as inventory management, warehousing, shipping, and last-mile delivery. Businesses like Shiprocket, Shipway, Pickrr, and others, often known as D2C enablers, have assisted hundreds of firms in streamlining these procedures in order to scale up quickly. The growing D2C sector is creating more opportunities in intra-city logistics in line with changing customer preferences for shopping and delivery.

India Intra-city Logistics Market Growth

Competitive Landscape

The market is relatively competitive, with a large number of local players, including FM Logistic India, Lets Transport, Shadowfax, Cogos Technologies, and Ecom Express. The industry has seen many investments in recent times. In April 2021, third-party logistics service provider FM Logistic India deployed its first batch of electric vehicles (EVs) in Bengaluru for intra-city last-mile delivery. The EVs will be used to carry out intra-city deliveries for WayCool, an Indian agri-commerce company, thus, driving social impact while transforming the food economy.

Recent Developments

In October 2021, Porter raised INR 750 crore in a Series E funding round, led by Tiger Global Management and Vitruvian Partners, with existing investors Sequoia Capital India and Lightrock India participating. Porter, established in Mumbai, is a logistics marketplace that enables businesses to rent trucks on demand to meet their intra-city logistical needs. Porter now works with e-commerce, FMCG, SMEs, traders, 3PLs, couriers, and freight firms. It shook up the logistics industry by introducing Porter for Enterprise and Packers and Movers, two on-demand marketplaces for LCVs and bikes. The cash infusion will be used to cement the company's position, focus on attracting talent, and expand operations to enter the top 35 cities in India by 2023, further solidifying its position as a logistics market leader.

In September 2021, Cogos Technologies, a Bangalore-based enterprise logistics startup, raised USD 2 million in a pre-Series A fundraising round, headed by Transworld Group, a global logistics and shipping firm. Worldquant Ventures, a deep tech fund based in New York, also participated in the round. The funding will be used to strengthen the logistics firm's technology platform and expand beyond India. Previously, the company raised a seed round of USD 1 million from the Indian Angel Network, among others. Cogos is a logistics technology platform aimed at intra-city firms that rely on trucks or smaller commercial four-wheelers and three-wheelers for their supply chain.

In August 2021, Blowhorn announced a new round of funding, which includes new investor Symphony International Holdings Limited. Blowhorn is a Bengaluru-based provider of same-day intra-city last-mile logistics, which offers transportation, warehousing, and a technology-integrated system to handle the end-to-end supply chain process, and it presently serves over 70 locations in India. The new funds will be used to assist Blowhorn's network expansion goals, allowing them to expand their geographical reach across India and serve a larger consumer base.

Table of Contents


    1. 1.1 Study Assumptions and Market Definition

    2. 1.2 Scope of the Market




    1. 4.1 Market Overview

    2. 4.2 Technological Trends

    3. 4.3 Government Initiatives and Regulations

    4. 4.4 Investment Scenarios

    5. 4.5 Industry Supply Chain/Value Chain Analysis

    6. 4.6 Insights into the E-commerce Industry

    7. 4.7 Insights into Same Day Delivery Market

    8. 4.8 Impact of COVID-19 on the Market (Including Short-term and Long-term Effects on the Market as well as Economy)


    1. 5.1 Drivers

    2. 5.2 Restraints

    3. 5.3 Opportunities

    4. 5.4 Porter's Five Forces Analysis

      1. 5.4.1 Bargaining Power of Suppliers

      2. 5.4.2 Bargaining Power of Consumers

      3. 5.4.3 Threat of New Entrants

      4. 5.4.4 Threat of Substitutes

      5. 5.4.5 Intensity of Competitive Rivalry


    1. 6.1 By Service

      1. 6.1.1 Transportation

      2. 6.1.2 Warehousing and Distribution

      3. 6.1.3 Value-added Services

    2. 6.2 By City

      1. 6.2.1 Delhi

      2. 6.2.2 Bangalore

      3. 6.2.3 Mumbai

      4. 6.2.4 Hyderabad

      5. 6.2.5 Chennai

      6. 6.2.6 Kolkata


    1. 7.1 Market Concentration Overview

    2. 7.2 Company Profiles

      1. 7.2.1 FM Logistic India

      2. 7.2.2 Porter

      3. 7.2.3 Lets Transport

      4. 7.2.4 cityXfer

      5. 7.2.5 Shadowfax

      6. 7.2.6 Cogos Technologies

      7. 7.2.7 Blowhorn

      8. 7.2.8 Ecom Express

      9. 7.2.9 TruckEasy

      10. 7.2.10 DTDC*

    3. *List Not Exhaustive


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Frequently Asked Questions

The India Intra-city Logistics Market market is studied from 2018 - 2027.

The India Intra-city Logistics Market is growing at a CAGR of >5.3% over the next 5 years.

FM Logistics India, Porter, Lets Transport, cityXfer, Shadowfax are the major companies operating in India Intra-city Logistics Market.

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