Delhivery Q1 Results Review — PL Capital Downgrades To 'Add' Amid Sharp Appreciation In Stock Price

While Delhivery’s top-line was a miss by 6.8% due to weak performance from supply chain services and cross border businesses, B2C shipment volume growth was back in double-digits after five quarters. Operating performance was better than estimate with Ebitda margin of 6.5% (brokerage estimate: 5.5%) while PAT was aided by higher other income of Rs 1,299 million (our estimate: Rs 1,059 million) due to MTM gains.

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PL Capital Report

We increase our FY26E/FY27E Ebitda estimates by 3.7%/2.0% amid strong performance in Q1 FY26 but downgrade Delhivery Ltd. to Accumulate (earlier Buy) with a target price of Rs 466 given 34% appreciation in stock price since our last update report.

While Delhivery’s top-line was a miss by 6.8% due to weak performance from supply chain services and cross border businesses, B2C shipment volume growth was back in double-digits after five quarters. Operating performance was better than our estimate with Ebitda margin of 6.5% (our estimate: 5.5%) while PAT was aided by higher other income of Rs 1,299 million (our estimate: Rs 1,059 million) due to MTM gains.

As retention volumes at E-com express are trending higher at ~55-65% versus earlier expectation of ~30%; near term earnings pressure arising from acquisition related integration cost of Rs 3,000 million will be low.

Improvement in the service Ebitda margin profile of PTL/SCM division to 13%/15% and 5%/6% in FY26E/FY27E respectively is expected to provide additional earnings cushion.

We expect sales CAGR of 13% over the next two years with Ebitda margin of 7.2%/9.2% in FY26E/FY27E and arrive at Delhivery’s per share value of Rs 405 (40x FY27E Ebitda; no change in target multiple).

We value Ecom express separately at Rs 61 per share and arrive at a blended target price of Rs 466. Downgrade to Accumulate amid sharp appreciation in stock price.

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