Accumulate Delhivery; target of Rs 466: Prabhudas Lilladher

Prabhudas Lilladher recommended Accumulate rating on Delhivery with a target price of Rs 466 in its research report dated August 04, 2025.

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August 04, 2025 / 14:34 IST

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Prabhudas Lilladher's research report on Delhivery

We increase our FY26E/FY27E EBITDA estimates by 3.7%/2.0% amid strong performance in 1QFY26 but downgrade DELHIVER IN to ACCUMULATE (earlier BUY) with a TP of Rs466 given 34% appreciation in stock price since our last update report. While DELHIVER IN’s top-line was a miss by 6.8% due to weak performance from SCS and cross border businesses, B2C shipment volume growth was back in double-digits after 5 quarters. Operating performance was better than our estimate with EBITDA margin of 6.5% (PLe 5.5%) while PAT was aided by higher other income of Rs1,299mn (PLe Rs1,059mn) 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 Rs3,000mn 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 2 years with EBITDA margin of 7.2%/9.2% in FY26E/FY27E and arrive at DELHIVER IN’s per share value of Rs405 (40x FY27E EBITDA; no change in target multiple).

Outlook

We value Ecom express separately at Rs61 per share and arrive at a blended TP of Rs466. Downgrade to ACCUMULATE amid sharp appreciation in stock price.

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