Shares of Delhivery surged 3 per cent on Wednesday after domestic brokerage Motilal Oswal initiated coverage on the stock with buy rating at a target price of ₹480, citing a 17 per cent upward potential.
Considering the strong focus on volume growth, cost reduction, enhanced service offerings, and tight B/S control, Motilal believes Delhivery is well placed to capitalise on the growth opportunity unfolding in the express logistics sector.
Delhivery clocked a 32 per cent revenue CAGR during FY19-25, driven by the express parcel business. Motilal anticipates EBITDA margins to improve from 4.2 per cent in FY25 to 7 per cent in FY28. It expects EBITDA of 36 per cent and APAT CAGR of 52 per cent over FY25-28.
“With improved earnings, we expect its RoE to improve to 5.6 per cent in FY28 from 1.8 per cent in FY25,” it added.
However, the brokerage flagged slower growth in the e-commerce segment and lower-than-expected penetration in the B2B express market could pose as signigicant risks.
Motilal Oswal noted that since its inception in 2011, Delhivery has rapidly expanded its presence in the express logistics market, initially capitalising on express parcel segment. The company is now strategically shifting focus toward the high-margin Partial Truckload (PTL) express market, aiming to strike a strong balance between growth and profitability.
The stock ended 3.03 per cent positive on the BSE at ₹421.35, hitting an intraday high of ₹424 against the previous close of ₹408.95.
Published on July 9, 2025
