Delhivery share price jumps 3% to 9-month high as Motilal Oswal initiates coverage with 'buy' call

Delhivery share price in focus today: Extending their winning streak for the sixth consecutive session on Wednesday, July 9, shares of Delhivery, the country’s largest fully integrated logistics services provider, rose another 3% to hit a nine-month high of ₹420.80 apiece.

The stock has been on a strong upward trajectory since its April lows, driven by positive business developments and renewed investor sentiment. The latest boost came after domestic brokerage Motilal Oswal initiated coverage on the stock with a ‘Buy’ rating and a target price of ₹480 per share, indicating an upside of nearly 18% from Tuesday’s closing price.

In its report, Motilal Oswal highlighted Delhivery’s strategic focus on acquisitions and integrated logistics solutions as key drivers of long-term growth. It expects Delhivery to be a key beneficiary of a growing e-commerce user base, expansion into new service categories, and the scaling up of emerging e-commerce models such as direct-to-consumer (D2C), social commerce, and omnichannel retail.

The brokerage highlights the company's growing market share in the e-commerce express segment, which doubled to around 25% in FY24 (and approximately 40% excluding captive volume), up from about 12% in FY19.

Delhivery has delivered a strong revenue CAGR of 32% over FY19–25, led by robust growth in its express parcel business and partial truckload (PTL) segment.

The brokerage also expects India’s e-commerce market to continue expanding, especially with increasing digital adoption in Tier 2 and Tier 3 cities. This, in turn, is expected to boost demand for express logistics services, prompting some traditional transport businesses to transition toward the express segment.

While express parcel delivery is likely to remain Delhivery’s primary revenue driver, Motilal Oswal anticipates steady traction in the PTL business as well.

Looking ahead, Motilal Oswal projects a 14% revenue CAGR for the company during FY25–28, supported by several factors, including healthy growth in the PTL industry (expected to grow at an 18% revenue and volume CAGR), operational leverage from network expansion and the integration of the Delhivery–Spoton acquisition, and the scaling up of integrated solutions, with around 60% of current revenue coming from customers using two or more services.

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.

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