A method for offloading multicast replication from multiple tiers of edge nodes implemented by multiple host machines to a physical switch is provided. Each of the multiple host machines implements a provider edge node and a tenant edge node. One host machine among the multiple host machines receives a packet having an overlay multicast group identifier. The host machine maps the overlay multicast group identifier to an underlay multicast group identifier. The host machine encapsulates the packet with an encapsulation header that includes the underlay multicast group identifier to create an encapsulated packet. The host machine forwards the encapsulated packet to a physical switch of the network segment. The physical switch forwards copies of the encapsulated packet to tenant edge nodes at one or more ports that are determined to be interested in the underlay multicast group identifier.