ICICI Securities Research Report on Delhivery

The stock of Delhivery has been challenged by several factors such as: 1) a slow-down in the 3PL market due to the increase in-house logistics by Meesho; 2) rapid growth of quick commerce in e-commerce, which stands on in-house logistics most of the time; and 3) apprehension around competitors gaining a higher market share in the 3PL space. It continues to consolidate its leadership in the express parcel segment through tight cost control and better service quality. For the PTL segment, it has sequentially grown closer to about 90% of combined volumes with Spoton and achieved profitability at the service EBITDA level from Q4FY24. Delhivery has also clarified that perceived share losses to a competitor are due to different reporting practices. We reiterate our BUY rating.