Block deal: SoftBank may sell Delhivery shares worth $150 million today, says report

SoftBank is reportedly looking to offload part stake in Delhivery, a logistics service provider, for around $150 million on Friday, a media report quoting multiple industry sources suggested. As per the Moneycontrol report, SoftBank was seeking to sell about 4 per cent stake in Delhivery via the block deal route with the deal size of around $150 million. Kotak Mahindra Capital was said to be the advisor to the proposed transaction. The Japanese firm had in October sold over Rs 1,000 crore worth shares of Zomato Ltd.  

Analysts noted that despite seasonality, Delhivery’s Q2 performance in surface express was robust. Regaining lost wallet share during Spoton’s integration along with yield improvement in the PTL business underpins the management’s focus on improving profitability together with gaining market share, Emkay Global said in a November 5 note.

"With a bulk of the network expansion investment for FY24 completed and pickup in demand imminent in Q3 (B2C monthly volume run rate up over 15% vs. Q2 average), H2 should see decent operating leverage for the company to turn EBITDA positive. Strong cash position lends support to future expansion plans while keeping any aggressive competition at bay," it said. The brokerage has a BUY rating on the stock with a target of Rs 490.

CLSA, meanwhile, reduced it share price target on Delhivery Ltd despite the logistics firm cutting its losses by more than half in the September quarter. The fresh CLSA target stands Rs 493 compared with Rs 550 earlier, as the brokerage reduced its sales estimates for FY24-25 by 3.2 per cent.

"We believe consensus is underestimating the operating leverage in the business as revenue scales up, and we are significantly higher on our Ebitda margin assumptions for FY26 than consensus," it said.

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