Block deal: Delhivery shares in news as Carlyle may sell 2.53% stake today

Shares of Delhivery Ltd will be in focus on Thursday morning as the private equity firm Carlyle is likely to sell a 2.53 per cent stake in the e-commerce logistics company today at Rs 385.50 a piece for Rs 709.50 crore or $86 million. As per reports, Carlyle, through an entity named CA Swift Investments, would offer 18.4 million shares of Delhivery and would entirely exit Delhivery. The price is at 0.9 per cent discount to Wednesday's closing price of Rs 388.95. Citigroup is reportedly appointed as the sole broker for the deal.

Delhivery is an integrated logistics company providing express parcel delivery, part- and full-truck load freight, warehousing, supply chain solutions and cross-border services. It is the largest third-party express parcel delivery service provider in India, with 40 per cent share of the 3PL market and 20 pre cent overall market share. Delhivery has a total logistics infrastructure of 18 million square feet reach spanning 18,000 pin-codes (96 per cent) across India.

Recently the company hosted its Analyst Day, post which Macquarie said integrated operations may drive cost competitiveness for Delhivery, as it suggested a target of Rs 460 on the stock. Kotak Institutional Equities said one thing still not very clear is the path in the near term to 10 per cent adjusted Ebitda margin (or high-teens service Ebitda margin). It has factored in 7 per cent Ebitda margin and start of free cash flow (FCF) from FY2026E. This brokerage has a target of Rs 410 on the stock.

"We see Delhivery to have a differentiated positioning in a commoditised market but still need further evidence of its ability to translate business model superiority into free cash flows and hence retain ‘HOLD’ rating. As the company still continues to incur heavy capital expenditures into tractor-trailers, automation, IT and supply chain, there could be a delay in the company providing strong return on capital," JM Financial said on the stock earlier this month.

Delhivery recently reported widening of net loss at Rs 159 crore for the March quarter. It reported a net loss of Rs 120 crore in the corresponding quarter last year.

The firm's revenue from operations declined 10 per cent to Rs 1,860 crore in the March quarter compared with Rs 2,072 crore in the year-ago quarter.