India's New-Age Internet Firms Brace for 2 Quarters of Lower FY27 Profits as Iran War Lifts Costs
Updated
Updated · The Economic Times · May 29
India's New-Age Internet Firms Brace for 2 Quarters of Lower FY27 Profits as Iran War Lifts Costs
1 articles · Updated · The Economic Times · May 29
At least the first 2 quarters of FY27 are expected to be subdued for India’s listed internet firms as higher fuel, packaging, freight and raw-material costs threaten to erode recent margin gains.
BofA said the current Q1 will show the first clear hit from fuel-price increases, with internet-first companies facing a sharper trade-off than FMCG peers because price hikes risk cutting order frequency.
Food delivery and quick-commerce platforms are seen as relatively better placed: March-quarter food-tech growth held at 20-25%, and they can lean on platform fees, handling charges, ads and delivery density.
Logistics and input-heavy consumer names face more direct pressure. Delhivery says fuel surcharges cover more than 90% of contracts, while Mamaearth, Lenskart and furniture and luggage brands are already dealing with rising input bills.
The broader consumption backdrop is also weakening—consumer brands have raised prices by 2-3%, packaging costs have jumped 25-30%, and some companies say shoppers cannot absorb 8-10% increases.
As delivery fees surge, is the era of affordable online convenience in India coming to an end?
Could soaring costs be the unexpected catalyst that finally forces India’s cash-burning startups to become profitable?