Shares of Delhivery slumped 5 percent on May 18 after the company slipped into losses again in the March quarter (Q4FY24). The logistics solutions company posted a loss of Rs 68.5 crore as against a profit of Rs 11.7 crore in the December quarter.
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On a year-on-year (YoY) basis, however, the loss narrowed down 57 percent from Rs 159 crore posted in Q4FY23.
Delhivery’s revenue in the March FY24 quarter rose 12 percent YoY to Rs 2,076 crore. The revenue growth was driven by the partial truckload (PTL) and full truckload (FTL) segments (up 27 percent and 60 percent YoY, respectively) in Q4FY24.
The company’s EBITDA climbed to Rs 46 crore from Rs 13 crore in the year-ago period.
Despite Q4 being a seasonally weaker quarter for the PTL industry, the logistics firm saw continued improvement in PTL volumes (up 21 percent YoY) on account of improving service levels and strengthening sales force in tier 2+ cities.
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Its express business, on the other hand, saw weakness due to seasonality, as well as, insourcing of volumes from a key customer.
The company’s margins came in at 2.2 percent, below street estimates of 2.6 percent, as gross margin expanded by 58bps. Delhivery’s integrated offerings, tech investments, and scale advantages have allowed it to gain market share in the PTL segment along with fortifying its leadership position in the 3PL Express market.
“With focus on ramping up other businesses like supply chain services, Delhivery will not only diversify its revenue streams but strengthen its moat of being the lowest cost operator, in our view,” said Emkay Global in a report.
The brokerage continues to expect the company to turn PAT positive in FY25, as tapering capex intensity and net cash balance sheet help soften the blow on volumes in the short term. It has maintained a ‘buy’ rating on the stock with a target price of Rs 500.
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Delhivery shares ended 4.99 percent lower Rs 431.10 on the National Stock Exchange (NSE). The stock has risen 11.7 percent so far this year, outperforming benchmark Nifty 50 which has risen around 3.5 percent during this period.
