Delhivery shares rise after six days as Jefferies sees 115% upside

Shares of logistics services provider Delhivery rose after six days of consecutive fall today after brokerage Jefferies assigned a target price of Rs 700 apiece, 115% higher to the previous closing price.  Delhivery stock gained 2.26 per cent intraday to Rs 333 against the previous close of Rs 325.65 on BSE. Delhivery stock is trading lower than the 5-day, 20-day, 50-day, 100-day and 200-day moving averages. Market cap of Delhivery rose to Rs 24,027 crore. 

Total 32.27 lakh shares of the firm changed hands amounting to a turnover of Rs 104.88 crore on BSE. The stock had fallen 13.02 per cent in the last six sessions.  It hit a record low of Rs 317 in the previous session.  In a month, the stock has fallen 17.63%. 

Jefferies is bullish on the stock with a target price of Rs 700.  

The B2C business is seeing temporary vs structural slowdown, Jefferies said adding that B2B ramp-up will be done with profitability focus. The brokerage believes current stock price has taken into account  6-8% express parcel growth in the next 3-5 years against 25% plus levels in the past.  

However, HSBC has cut its target price to Rs 455 against Rs 710 for  Delhivery with a buy call.  

HSBC said that consecutive weak quarters have shattered street’s confidence on near/medium-term growth for Delhivery. E-commerce industry growth has slowed in India & has impacted Delhivery too. But that has been taken into account in the price.  

Also Read: Delhivery stock hits all-time low on Rs 607-crore bulk deal

Market share loss for Delhivery is not a structural worry, HSBC added  

Amol Athawale, Deputy Vice-President - Technical Research, Kotak Securities, said, "In this quarter so far, the stock has corrected nearly 45 per cent. The stock consistently faced selling pressure at higher levels. Lower top formation on intraday charts and correction continuation formation on daily charts indicated further weakness from the current levels. We are of the view that the short-term texture of the stock is weak but oversold. For now, as long as the stock is trading below Rs 365 or 20-day SMA (Simple Moving Average), the weak wave is likely to continue and below the same, it could slip to Rs 300-280 levels. On the flip side, a quick pullback rally is possible if it succeeds to trade above Rs 340, and above that, it could move up to Rs 350-360." 

Also Read: Delhivery shares fall for sixth straight session, hit record low? Here's what experts say

A R Ramachandran from Tips2trades said, "Anchor investors exiting the stock despite decent Q2 FY23 results. Forecasts of lower economic growth in the coming year have led to a consistently sharp fall in Delhivery stock price. Even though the Delhivery stock price is technically very oversold, investors should wait for a daily close above 339 to buy for targets between Rs 380 and Rs 405 in the near term. Next lower support would be at Rs 297."

Also Read: Share Market News Live: Sensex rises over 150 points on positive global cues, Nifty tops 18,300; Keystone Realtors to debut today