Delhivery Q1 Results Review - Profit Secured; B2C Volume Uncertainty Rises: Prabhudas Lilladher

Prabhudas Lilladher Report

We change our stance from ‘Buy’ to ‘Accumulate’ with a target price of Rs 450 based on DCF given the management's commitment to improving B2C volumes through cost leadership and innovations like multi-client dark stores to capitalize on the quick commerce trend, we see increased uncertainty amid cannibalization of traditional E-commerce by Q-commerce and with the emergence of newer platforms, higher discounting by platforms and third party logistics players alike in the near to medium term.

Delhivery Ltd.’s consolidated revenue grew by 12.6% YoY to Rs 21,723 million in Q1 FY25 (our estimate: Rs 20,247 million). Ebitda/profit after tax level turned positive at Rs 971 million/Rs 544 million against loss of Rs 130 million/Rs 895 million in Q1 FY24 (our estimate: -Rs 202 million/-Rs 945 million).

B2C segment’s volume stood at 183 million (up 1% YoY) with realization increasing by 6% YoY to Rs 69.7/parcel due to a favorable product mix, thereby leading to 6.2% growth in revenue YoY to Rs 12,760 million. PTL volume/revenue grew 16%/25% YoY to 0.4 million/Rs 4,350 million, while realization improved by 7.8% YoY to Rs10,902/ton.

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