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| Good morning. The world of e-commerce and quick commerce seems to be evolving in weird directions. The latest trend is everything in 10 minutes — from tomatoes to toasters. Jumping on this quick delivery bandwagon are old school logistics players, investing big in dark stores that can facilitate this. But there seems to be no game plan. | In other news, India plans tariff cuts under pressure from US president Donald Trump. Meanwhile, a new development in the Ola Electric vs Rosemerta Group case. | | DECODE THE NEWS | Indian Logistics Firms Betting Big On Dark Stores, But Without An Actual Roadmap | | | Last month, logistics player DTDC announced its first dark store in Bengaluru, citing a need to meet the growing demand for quicker deliveries. The dark store, they said, would provide two to four-hour deliveries and same-day deliveries. | DTDC follows several other logistics companies, such as Ecom Express, Delhivery, and Shadowfax, that have also shifted their focus towards providing same-day and quick deliveries of e-commerce products. | “Quick commerce players have successfully created a market for fast deliveries. Since this model is here to stay and we enable all forms of commerce — be it quick commerce, e-commerce, or beyond — it’s all about how fast we can adopt, adapt and differentiate,” Vishwachetan Nadamani, COO at Ecom Express, told The Core. | Unlike quick commerce platforms such as Zepto, Blinkit, Swiggy Instamart, and others that primarily deliver groceries, logistics dark stores are meant to focus on a broader range of e-commerce categories, including fashion, makeup, and electronics. | However, even among the grocery delivery apps mentioned above, only Zomato-owned Blinkit has been able to break even in this business. Zepto and Swiggy Instamart, the other two leaders, are still burning cash on their quick commerce business. | Logistics companies are betting big on dark stores for faster deliveries. While even quick commerce, which focuses on daily essentials, has yet to show profitability for some companies, the dark stores of logistics companies are meant for categories like fashion and electronics, where demand for instant delivery is less clear. | There are further hurdles beyond India's tier one cities. With so many challenges at hand, questions arise about whether this will grow into a profitable new way of logistics or another money-burning investment that companies will eventually abandon. | I don’t see long-term sustainability in this model. | | | | Nayaan Ratandharaya, founder and CEO at Shipyaari |
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| Clear Case Of FOMO? | Nayaan Ratandharaya, founder and CEO at Shipyaari, believes that all companies opening dark stores were doing it because of FOMO, a Gen Z term that is the short for ‘fear of missing out’. “I don’t see long-term sustainability in this model,” Ratandharaya said. | Quick commerce platforms have significantly invested in infrastructure to establish their model. Meanwhile, Ecom Express, already present in 3,500+ locations, is leveraging its existing warehouses to deliver faster while still experimenting with its larger approach. | Quick commerce is still in flux, with no proven model yet. The sector has exploded by 280% in two years, with gross merchandise value soaring from $0.5 billion in FY22 to $3.3 billion in FY24. But for logistics players, the game is all about two things: experience and cost. | So far, the success of quick commerce has been limited to India’s tier-one cities and within the segments of groceries and everyday essentials, where impulse buying and urgent needs fuel transactions. | The same can’t be said for the products that are housed in the dark stores of larger logistics players, such as clothing or electronic appliances. | “For categories like fashion, where customers want to explore different styles, trends, and patterns, quick commerce doesn’t quite fit the bill,” Kushal Bhatnagar, associate partner at Redseer, told The Core. | These goods are also less frequently bought than everyday groceries, where quick commerce has so far been growing. | Will dark stores become the backbone of fast shipping, or will they fade out as do most trends? | | |
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| MESSAGE FROM MORNING BREW | The newsletter every professional should be reading | | There’s a reason Morning Brew is the gold standard of business news—it’s the easiest and most enjoyable way to stay in the loop on all the headlines impacting your world. | Tech, finance, sales, marketing, and everything in between—we’ve got it all. Just the stuff that matters, served up in a fast, fun read. | Look—over 4 million professionals start their day with Morning Brew’s daily newsletter, and it only takes 5 minutes to read. Sign up for free and see for yourself! | Check it out | | CORE NUMBER | | | | | Rs 5,156 crore | This is the tax and penalty slapped on Samsung India for allegedly dodging tariffs on telecom equipment imports, Reuters reported. The government alleges that Samsung misclassified “Remote Radio Head” units — critical 4G tower components — as duty-free, avoiding tariffs on Rs 6,700 crore worth of imports from 2018 to 2021. Officials accused the company of knowingly presenting false documents and defrauding the exchequer. Seven top executives have also been fined Rs 695 crore. Samsung denies wrongdoing and is exploring legal options. The crackdown also mirrors the government’s ongoing Rs 11,800 crore tax battle with Volkswagen over misclassified auto parts. |
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| FROM THE PERIPHERY | | | | | —🚢 Tariff Bargain! India is considering cutting tariffs on over half of US imports worth $23 billion as part of a trade deal, aiming to counter Trump’s impending reciprocal tariffs, Business Standard reported. New Delhi fears the tariffs could hit 87% of its $66 billion exports to the US. India may lower or scrap duties on some US goods but insists on relief in return. Sensitive sectors like meat and dairy are off-limits, though almonds and quinoa may see cuts. However, broader tariff reforms remain uncertain, with Modi balancing political and economic stakes. |
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| | | | | —⛽ ONGC Expands Its Operations. India’s largest oil and gas explorer, Oil and Natural Gas Corp (ONGC), is expanding its focus to safeguard against volatile oil prices and an impending global supply glut. To mitigate risks, ONGC is diversifying into refining, petrochemicals, LNG trading, and renewable energy, according to an Economic Times article. The company plans to expand its renewable capacity to 10 gigawatts by 2030, about three times more than its current capacity. |
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| | | | | —👀 Ola Electric v/s Rosmerta. Just a day after Rosmerta Digital Services — a key vendor that handles vehicle registration processes for multiple electric vehicle makers — refiled its insolvency plea against Ola Electric Technologies, Ola on Tuesday morning informed stock exchanges that it had fully settled dues worth Rs 26.75 crore. Rosmerta confirmed receiving the amount and said it will withdraw its National Company Law Tribunal petition. The abrupt reversal, coming immediately after the refiling, has raised more eyebrows, especially since Ola had not disclosed the dues in earlier regulatory filings. |
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| | | | | —⚜️ Citizenship Price Hike! The US has sold over a thousand “gold cards” to aspiring permanent residents, said US Commerce Secretary Howard Lutnick to the All-In podcast, according to a Business Standard story. US president Trump announced the $5 million citizenship-granting gold card as a potential replacement for the $1 million EB-5 investor visa. Immigration lawyers say scrapping the EB-5 programme would harm Indian HNIs wanting to move to the US, who might instead move to other countries, like the UAE, Portugal and Greece. |
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| | | | | UGHH | | For years, policy holders have accused Star Health of ghosting them when it comes to claim settlements. Now, the regulator is finally listening. As per a CNBC-TV18 report, the Insurance Regulatory and Development Authority of India has flagged Star Health’s dismal track record — claim settlement within three months was just 82.31% in FY24, the lowest among stand-alone health insurers. And get this: it rejected nearly 3 lakh claims last year, four times more than the next worst player. For every Rs 100 collected as premium, Star pays only Rs 67 in claims, well below the industry average of Rs 82. Even worse, it topped grievance charts with over 16,000 complaints. | While Star Health says it hasn’t received formal communication from IRDAI, the angry posts on social media, public rants, and rising complaints say otherwise. For an insurer that promises “Happily Insured,” this is more “Regretfully Denied.” |
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| | | | | PODCAST | On Episode 540 of The Core Report, financial journalist Govindraj Ethiraj talks to Manish Gupta, Senior Director and Deputy Chief Ratings Officer, Crisil Ratings Limited. We also feature an excerpt from our recently released Business Books Edition featuring author and entrepreneur K Ganesh. | Markets halt their rally but hold in positive despite fresh tariff threats and Asian weakness. Tariffs are back on the table and gold is strengthening again. Oil prices start inching up on threat of US tariff on Venezuelan crude. Shell unveils major gas targets. In unusual phenomenon, India’s cement industry is seeing acquisitions at a per tonne cost lower than greenfield projects. A story of disruption, from the days of the personal computer, with K Ganesh.
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