Delhivery shares hit 9-month high today: Here we decode why
What's the story
Delhivery, India's largest integrated logistics services provider, has witnessed a surge in its share price for the sixth consecutive session. The stock rose by 3% today to hit a nine-month high of ₹420.80 per share. The rise comes after domestic brokerage firm Motilal Oswal initiated coverage on Delhivery with a 'Buy' rating and a target price of ₹480 per stock.
Growth prospects
It should benefit from growing user base
Motilal Oswal's report emphasized Delhivery's focus on acquisitions and integrated logistics solutions as important drivers of long-term growth. The brokerage expects the company to benefit from a rising e-commerce user base, expansion into new service categories, and scaling up emerging e-commerce models like direct-to-consumer (D2C), social commerce, and omnichannel retail.
Financial performance
Surging market share in e-commerce express segment
Motilal Oswal's report also noted Delhivery's surging market share in the e-commerce express segment, which doubled to roughly 25% in FY24 from some 12% in FY19. The company has posted a strong revenue CAGR of 32% over FY19-25, fueled by the robust growth in its express parcel business and partial truckload (PTL) segment.
Market outlook
Shares began their recovery in March
Delhivery's stocks began their recovery in March after being under severe selling pressure for five consecutive months. The stock has gained 78% since hitting an all-time low of ₹236.53 per share in March. Motilal Oswal projects a 14% revenue CAGR for the company during FY25-28, supported by healthy growth in the PTL industry, operational leverage from network expansion, and integration of the Delhivery-Spoton acquisition.