Delhivery (DELHIVERY)

FairStock Score: 43/100 — MIXED

Score breakdown: P/E: 0/3 · ROCE: 0/2 · Growth: 2/2 · Dividend: 0/1

Key Financials

Strengths

• 5-year revenue CAGR of 19.62% and latest sales growth of 11.73% demonstrate strong top-line momentum.
• Balance sheet is conservatively financed with debt/equity of 0.17 and Altman Z-Score of 3.34.
• Positive free cash flow of ₹465 Cr and Piotroski F-Score of 8/9 signal improving fundamental health.
• Latest quarter shows net profit of ₹40 Cr on ₹2,805 Cr sales, with profit growth of 625% indicating an early earnings turnaround.

Concerns

• Extreme valuation: P/E of 180.15, EV/EBITDA of 118.30, and price of ₹449 is far above DCF value of ₹332.74 and Graham Number of ₹79.51.
• Low capital efficiency: ROE of 1.62% and ROCE of 2.47%; latest net margin is only ~1.4%.
• Zero promoter holding and zero dividend yield raise governance and shareholder-return concerns.
• 625% profit growth is from a tiny base, so it is not yet evidence of durable earning power.

AI Analysis

At ₹449, Delhivery is priced for a smooth landing, but I see a turnaround still in its early innings. The company has grown admirably—5-year revenue CAGR of 19.62%, latest sales growth of 11.73%—yet growth is only worthwhile when it translates into earning power. Here, ROE is just 1.62% and ROCE 2.47%. In the latest quarter, ₹2,805 Cr of sales produced only ₹40 Cr of net profit, a margin so thin that any shock can erase it. The 625% profit growth sounds spectacular, but it comes off a tiny base; the real question is whether Delhivery can convert its vast distribution scale into much higher returns on capital. The balance sheet is not the problem: debt/equity is only 0.17, free cash flow is positive at ₹465 Cr, Altman Z-Score is 3.34, and Piotroski F-Score is 8/9. This is not a distressed company. But my job is not to buy a sound balance sheet at any price. At a P/E of 180.15 and EV/EBITDA of 118.30, the market is paying a fortune for every rupee of current earnings. The DCF value is ₹332.74 and the Graham Number is just ₹79.51. Against ₹449, there is no margin of safety—only a margin of hope. I also dislike zero promoter holding and no dividend. I want owners with skin in the game. Delhivery may become a wonderful compounder if it can lift ROE into double digits, but paying 180 times earnings for a 1.62% ROE is not intelligent investing. I will watch from the sidelines until either the earnings power becomes visible or the price falls to a level Graham would approve.

Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer