Logistics firm Delhivery is betting on value efficiencies constructed over the previous yr, and a steadier market to broaden revenue margins, although the timing of the products and providers tax (GST) adjustments damage cargo volumes in September.
At a post-earnings name on Wednesday for the September quarter, Delhivery chief govt Sahil Barua mentioned that after buying Ecom Specific, the corporate not wants heavy reductions, and its Specific margins can rise above 18% as competitors eases and smaller rivals retreat.
Delhivery accomplished the acquisition of Gurugram-based Ecom Specific for ₹1,407 crore in July, gaining cargo quantity and market share.
“Publish the acquisition, we’re in all probability nearer to someplace between 27 and 30% or so (in market share),” Barua mentioned.
The corporate has aggressively rationalised the acquired footprint, retaining simply seven services (1.3 mn sq. ft.) whereas exiting almost 1.1 mn sq. ft. Furthermore, it has trimmed about 85% of Ecom Specific’s company and help prices for the reason that deal.
Delhivery additionally plans to wind down some inherited contracts. “Ecom was in sure companies that Delhivery doesn’t wish to service. That will even simply wash out and go to zero,” Barua mentioned.
Delhivery reported ₹2,546 crore in income from providers within the September quarter (Q2 FY26), up 16.3% year-on-year, whereas posting a internet lack of ₹51 crore for the quarter. The corporate served 48,442 lively clients in the course of the interval. Its bodily community spanned 22.05 million sq. ft from 19.48 million sq. ft a yr in the past, reaching 18,830 pin codes.
Shares of Delhivery settled 2.7% greater at 4,84.95 apiece on the BSE on Tuesday. Markets have been closed on Wednesday for a public vacation.
Decreased discounting strain
Barua reiterated that Ecom Specific’s long-term Ebitda (earnings earlier than curiosity, taxes, depreciation, and amortization) margins can rise past the corporate’s acknowledged 16–18% vary, relying on pricing selections.
“Past 18%, if the corporate feels it’s essential… and if… there’s further share of pockets for us to be gained, we sometimes are likely to go a specific amount of pricing advantages again,” Barua mentioned.
Nevertheless, consolidation and inflationary strain on opponents have lowered the necessity to give reductions.
“Because the aggressive depth on this sector has lowered… the need for us to go on these advantages has lowered yr on yr,” he mentioned.
The Specific enterprise reported 15.3% service Ebitda margin in Q2—barely softer sequentially, partly as a result of volumes moved into October following GST adjustments.
GST’s short-term drag
The change in GST charges additionally precipitated a short lived drag. “When the GST charges have been modified, I believe individuals consciously postponed consumption… That’s the reason in the course of the center 10 days in September, there was truly a dip in consumption,” Barua famous.
The quantity rebound was led by classes similar to shopper durables, he mentioned.
Delhivery’s categorical parcel volumes rose to 246 million orders in Q2FY26, rising 32% y-o-y and 18% sequentially.
The 7.2-million single-day peak got here within the broader festive window, throughout which volumes shifted towards late September and early October after GST-related demand timing adjustments.
The federal government’s GST reforms, which turned efficient from 22 September, eradicated charge slabs of 12% and 28%, making a two-slab system with services taxed at 5% and 18%.
Speedy commerce nonetheless small, constructing out
Delhivery’s quick-commerce–adjoining guess stays nascent, although the corporate is steadily widening the community. Barua mentioned the enterprise at the moment runs at about ₹12-crore annualised income, supported by 20 darkish shops throughout three cities, and is predicted to scale meaningfully over the following few quarters.
“We count on Speedy Commerce to contribute revenues of ₹80–100 crore within the close to to mid-term… We’ll start operations in NCR (nationwide capital in Q3 FY26,” he mentioned, including that the corporate plans to increase the providing to B2B purchasers in Q3 and This autumn FY26.
Below Speedy Commerce, the corporate guarantees to ship parcels in 2 hours.
