Delhivery’s latest quarter highlights resilience in its growth trajectory despite margin pressures and market scepticism, as analysts remain optimistic about its long-term profitability and industry consolidation efforts.
Delhivery’s latest quarter has sharpened the debate around its earnings power even as the logistics company continues to post brisk expansion in its core businesses. According to Business Standard, the company said its express parcel and part-truckload, or PTL, operations should deliver steady-state margins of 16% to 18% over the next two years, with volume growth still running at 20% to 30% in B2C parcels and 18% to 22% in PTL.
That guidance has not stopped brokerages from trimming forecasts after the weaker-than-expected first quarter margin performance. Business Standard reported that operating profit estimates for FY27 have been cut by 8% to 12%, although analysts have kept buy recommendations in place on the back of Delhivery’s revenue trajectory and profit potential. Motilal Oswal, for example, has retained a buy call and a target price of ₹570, saying the company remains well placed because of momentum in transportation services and a sharper focus on profitability.
The company’s growth story is being driven by higher business from existing clients, new customer wins, the integration of Ecom Express and wider industry consolidation, Business Standard said. It reported express parcel volume growth of 55% and PTL growth of 18%, while segment operating margins were 15.6% and 11.2% respectively. Delhivery’s overall operating margin, however, fell to 4.9% in the quarter, hit by higher labour costs after minimum wage revisions in several states, weaker labour availability around elections and a delay in fuel cost pass-through.
The company said that, without the fuel-related hit of ₹35 crore and Ecom integration costs, reported operating margin would have been about 6.6%. That context helps explain why the brokerage community remains constructive despite the near-term squeeze. Recent reports from Moneycontrol said Motilal Oswal expects Delhivery’s revenue and EBITDA to compound at 13% and 33% respectively over FY26-FY28, while Delhivery’s own shareholder letter showed stronger shipping and freight volumes and a better combined service EBITDA margin in transportation.
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