Delhivery stock fell 25% in a year but analysts expect it to cross Rs 500 mark; here’s why

Shares of logistics services firm Delhivery Ltd have fallen 25% in year. This is the maximum fall for the scrip across different time spans (1 week , 2 week, one month, three months, six months and YTD) in today’s trade. Returns for two years or more cannot be calculated since the stock was listed on bourses on May 24, 2022. On the other hand, Delhivery shares have recovered 46% from their 52-week low of Rs 291 hit on January 27, 2023. They touched a 52-week high of Rs 576.15 on October 13, 2022.

In the current session, the Delhivery stock was trading flat at Rs 425 on BSE. Market cap of Delhivery stood at Rs 31,180 crore. It opened lower at Rs 425.70 against the previous close of Rs 429 on BSE. A total of 0.12 lakh shares of the firm changed hands amounting to a turnover of Rs 52.16 lakh on BSE. Market cap of the firm fell to Rs 31,180 crore on BSE.

In terms of technicals, the relative strength index (RSI) of Delhivery stands at 53.8, signaling it's trading neither in the overbought nor in the oversold zone. The stock has a beta of 0.8, indicating very low volatility in a year. Shares of Delhivery are trading higher than the 5 day, 10 day, 20 day, 50 day, 100 day , 200 day but lower than the 30 day moving averages.

Market analysts are bullish on the stock and expect it to cross Rs 500 mark.

Vaishali Parekh, AVP- Technical Research & Analysis at Prabhudas Lilladher said, "The stock after the short gradual correction witnessed recently has bottomed out near Rs 404 levels and indicated a pullback with a positive candle pattern on the daily chart to improve the bias moving past the significant 50EMA level of Rs 418 zone. The RSI has indicated a trend reversal to signal a buy and one can expect for further rise in the coming days provided the Rs 400 zone is maintained as of now. Once a decisive breach above Rs 452 zone is confirmed, then with a breakout indication can anticipate for further targets of Rs 495 and Rs 540 levels."

Abhijeet from Tips2Trades said, "Delhivery is bullish on the daily charts and a close above resistance of Rs 453 could lead to a target of Rs 484 in the near term. Strong support will be at Rs 422."

Gaurav Bissa, VP at InCred Equities said, "Delhivery was seen in a strong downtrend since getting listed on the Indian bourses. The stock was consistently forming lower highs and lower lows which kept the stock under constant pressure. However, the stock confirmed trend reversal at Rs 360 levels which pushed it toward Rs 400 mark. The stock continues to remain in uptrend and has recently bounced from 21ema support on the weekly charts. RSI has also bounced from support area of 53 on the weekly charts implying the downside is likely to be restricted and stock is expected to continue its uptrend. Investors who hold the stock are advised to ride the trend, which can take it towards Rs 510 levels with a stoploss placed at Rs 385 levels."

Global brokerage Jefferies has a buy call on the Delhivery stock with a target price of Rs 570.

"2HFY23 results surprised positively with lower losses. We believe current price factors in less than 10% express parcel growth in the next 3-5 years vs 30% plus levels seen in the past. Delivery on the toned-down expectations should be enough for the stock to move materially higher in 2023," it said.

Delhivery’s net losses narrowed to Rs 89.4 crore for the quarter ended June 30, 2023 as compared to Rs 399.3 crore in the same quarter last year. The revenue of the company climbed 10 per cent to Rs 1,929.7 crore as compared to Rs 1,745.7 crore in the previous year.

Delhivery is engaged in providing a full range of logistics services, including delivery of express parcel and heavy goods, PTL freight, TL freight, warehousing, supply chain solutions, cross-border Express, freight services, and supply chain software. Delhivery is the largest and fastest-growing fully integrated logistics services player in India by revenue as of FY21.

Disclaimer: Business Today provides stock market news for informational purposes only and should not be construed as investment advice. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.

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