 "e-commerce")
The surge in e-commerce transactions during the festival season is proving a tailwind for logistics companies and should be reflected in stronger 2025-26 (FY26) July–September quarter (Q2) results. The pickup in deliveries is lifting volumes, while higher operating leverage could improve margins. Among the key beneficiaries is Delhivery, India’s largest third-party express parcel logistics firm, with a market share of over 20 per cent.
The company recently said it handled a record 104.4 million e-commerce and freight shipments in its transport network and moved goods worth ₹19,500 crore in the first phase (September) of the festival period.
ICICI Securities, after its channel checks, estimates that e-commerce growth accelerated 15-20 per cent year-on-year (Y-o-Y) in Q2FY26, helped by lower income taxes, reduced goods and services tax (GST) rates, and strong festival demand.
Analysts led by Abhisek Banerjee believe Delhivery stands to benefit, given its extensive supply chain that can absorb spikes in demand without compromising service quality. The brokerage expects express parcel shipments to rise 30 per cent Y-o-Y in Q2FY26, with operating profit margins up about 100 basis points sequentially on an adjusted basis. The stock — up roughly 88 per cent in the past six months — remains its top logistics pick.
Delhivery’s ₹1,400 crore purchase of Ecom Express in July has further lifted volumes during the festival period and strengthened its market position.
Analysts at Elara Securities, led by Ankita Shah, expect Delhivery to report solid express parcel growth in Q2FY26, supported by the integration of Ecom Express and pre-festival orders. The cut in GST rates should also aid shipment volumes, projected to grow 33 per cent Y-o-Y to 245 million, even with some deliveries shifting from late September to early October.
Integration costs related to Ecom Express will weigh on profitability in the short term but are one-off and should normalise by the fourth quarter of FY26, the brokerage said. Depreciation and finance expenses are likely to rise due to the continued use of network facilities.
The part-truckload (PTL) business is expected to maintain steady growth of 15 per cent Y-o-Y in Q2, supported by stable operations and an expanding service reach. However, the supply chain segment may remain uneven in the near term. Elara Securities has a ‘buy’ rating on the stock.
Delhivery’s medium-term outlook also appears steady, as the domestic express delivery segment is expected to grow faster than the broader logistics sector, driven by network expansion, digitisation, and a higher e-commerce share.
With scale and network maturity, its operating performance is set to improve. Motilal Oswal projects operating margins will rise from 4.2 per cent in 2024–25 (FY25) to 7.3 per cent by 2027–28 (FY28), aided by operating leverage, better asset utilisation, and greater technology integration across the value chain. It has a ‘buy’ rating and expects operating profit to grow 38 per cent over FY25–FY28.
The company expects PTL margins to reach 16-18 per cent in two to three years (from 11 per cent in the first quarter, or Q1FY26), while margins in express parcel services could increase to 17-18 per cent (from 16 per cent in Q1FY26) by March next year.
Delhivery’s strong balance sheet and lower capital intensity will help. JP Morgan notes that capital expenditure as a share of sales has declined from 9 per cent in 2018-19 to 5.2 per cent in FY25, with a target of 3.5-4 per cent. With net cash of ₹5,450 crore and financial flexibility, Delhivery is positioned to pursue strategic acquisitions, analysts Vibhav Zutshi and Karen Li wrote. The brokerage has an ‘overweight’ rating and expects operating profit to grow 58 per cent between FY25 and FY28, supported by scale efficiencies and easing competition.
