Delhivery Achieves Remarkable Q1 FY24 Performance: Surpasses Rs 1,900 Crore Revenue, Losses Shrink by 78%
Delhivery Achieves Remarkable Q1 FY24 Performance: Surpasses Rs 1,900 Crore Revenue, Losses Shrink by 78%
During the first quarter of the financial year 2023-24 (Q1 FY24), logistics company Delhivery witnessed significant growth in its revenue from operations. The company’s unaudited consolidated quarterly report, published on the National Stock Exchange, revealed that it recorded a revenue of Rs 1,929.8 crore, reflecting a growth of 10.55% compared to the revenue of Rs 1,745.7 crore in the corresponding period of the previous year (Q1 FY23).
In addition to its operating income, Delhivery also earned non-operating income, which includes interest and gains on financial assets, amounting to Rs 101.32 crore during Q1 FY24. Combined with the operating income, the overall revenue for the quarter reached Rs 2,031.1 crore.
This revenue growth indicates positive performance and operational efficiency for Delhivery during the first quarter of the current financial year. The company’s ability to generate operating and non-operating income contributed to its overall financial success during this period. As the logistics industry continues to play a crucial role in facilitating commerce and supply chain management, Delhivery’s strong revenue growth signals its competitiveness and relevance in the market.
During the first quarter of the financial year 2023-24 (Q1 FY24), Delhivery’s revenue from operations grew by 3.8% compared to the previous quarter (Q4 FY23). The company’s revenue in Q1 FY24 reached Rs 1,929.8 crore; in Q4 FY23, it was Rs 1,860 crore.
Among its total expenses, freight, handling, and servicing-related costs accounted for 67.52%, amounting to Rs 1,438 crore in Q1 FY24. Employee benefits expenses stood at Rs 353.2 crore during the same quarter.
The increase in revenue from Q4 FY23 to Q1 FY24 indicates a steady growth trajectory for Delhivery, although the pace of growth appears to have moderated slightly in the most recent quarter. The company’s expenses, especially freight, handling, and servicing, are a significant portion of its overall costs. Managing these expenses effectively will remain crucial for Delhivery’s profitability and financial performance in the future.
As Delhivery continues to operate in the competitive logistics industry, its ability to balance revenue growth with cost management will be vital for sustaining its position as a leading player in the market. Additionally, with the evolving dynamics of the logistics sector, the company may explore further opportunities for diversification and expansion to drive future growth.
During the first quarter of the financial year 2023-24 (Q1 FY24), Delhivery recorded total expenditures of Rs 2,129.7 crore, which included depreciation and amortization costs of Rs 167.3 crore and finance costs of Rs 19.5 crore. This represents a 3.45% decrease in total expenses compared to the same quarter of the previous year, which stood at Rs 2,205.7 crore.
Despite the revenue increase, Delhivery improved its bottom line significantly in Q1 FY24. The company’s losses contracted by over 77%, amounting to Rs 89.5 crore, compared to Rs 399.3 crore in Q1 of FY23.
The loss reduction indicates a positive trend for Delhivery, reflecting its cost management and operational efficiency efforts. By controlling its expenses and optimizing its operations, the company has been able to mitigate losses and move towards more sustainable financial performance.
The revenue growth and the reduction in losses bodes well for Delhivery’s financial health and market position. As the company continues to expand its logistics services and tap into new opportunities in the industry, it will be crucial for them to maintain this positive trajectory and further improve its profitability in the coming quarters. Effective utilization of its resources and continued focus on delivering value to customers will be essential in achieving long-term success in the highly competitive logistics market.
Delhivery’s unit-level efficiency, measured as the cost incurred to earn one rupee of operating income, stood at Rs 1.1 during the first quarter of FY24. This indicates that the company managed to generate operating income at a relatively low cost, which is a positive sign of effective cost management and operational efficiency.
Regarding quarter-on-quarter growth, Q1 FY24 was indeed an impressive period for Delhivery. The company achieved a significant milestone by crossing the Rs 1,900 crore quarterly revenue mark, indicating strong demand for logistics services and successful business expansion. Along with the revenue growth, Delhivery also improved its bottom line significantly, reporting the lowest losses in the last quarter. This indicates that the company’s efforts to optimize its operations and control costs have effectively enhanced its financial performance.
In FY23, Delhivery recorded a modest growth of 5%, achieving a total revenue of over Rs 7,200 crore. Despite the challenging business environment, the company managed to control its losses, reducing them to Rs 1,007 crore compared to Rs 1,011 crore in the previous fiscal year. This indicates the company’s efforts to improve its financial performance and move towards a more sustainable business model.
As part of its employee incentive program, Delhivery granted Employee Stock Ownership Plan (ESOP) options to its employees ahead of its quarterly results. These ESOP options are estimated to be worth approximately Rs 74 crore, and each option will be converted into equity shares, providing employees with an opportunity to share in the company’s future success and growth.
The decision to grant ESOP options can be seen as a strategic move by Delhivery to retain and motivate its workforce and align its interests with the company’s long-term goals. By offering employees a stake in the company’s ownership, Delhivery can foster a sense of ownership and commitment among its employees, which can lead to increased productivity and loyalty.
Delhivery’s plans to enter the hyper-local delivery space show the company’s continued focus on diversifying its services and exploring new business opportunities. Conducting a pilot with a quick commerce firm indicates Delhivery’s efforts to test the waters in this space and understand the dynamics of hyper-local delivery. Delhivery aims to leverage its logistics expertise to offer seamless and efficient services in the hyper-local delivery segment by taking care of packaging and delivery in the pilot.
In the same quarter, Zomato and Paytm also reported their financial results. Zomato, led by Deepinder Goyal, recorded a significant milestone by reporting Rs 2416 crore in operating revenue and achieving profitability in the last quarter. This indicates the success of Zomato’s business model and its ability to generate revenue from its food delivery and other services.
On the other hand, Paytm registered Rs 2,342 crore in revenue but also reported an operating loss of Rs 358 crore during the same period. Despite the loss, Paytm’s revenue reflects its strong presence in the digital payments and financial services sector, and the company continues to invest in expanding its offerings and user base.
The results of all three companies highlight the competitive landscape and opportunities in India’s rapidly growing tech and logistics sectors. Delhivery’s entry into the hyper-local delivery space could further intensify competition and add another dimension to the country’s evolving e-commerce and logistics ecosystem. As these companies continue to innovate and expand, they aim to capture a larger share of the Indian market and provide valuable services to their customers.
