Delhivery Q1 net loss widens, revenue grows 32 per cent
In the first quarter of 2022, which ended in June, Delhivery Ltd’s consolidated net loss increased to 399 crore from 129.6 crore in the corresponding quarter of the previous year. The company’s revenue increased by more than 32% year over year to $1,745.7 crore from $1,317.7 crore (YoY). Compared to the adjusted EBITDA loss of 58 crore (proforma) in QIFY22, the company experienced a loss of 217 crore in QIFY23.
Abhik Mitra, Chief Customer Experience Officer, Delhivery and CEO of Spoton, stated that “Due to the inherent seasonality of the PTL business, the slightly later than anticipated phasing of customer restarts, and the retention of capacity to ensure service quality and in anticipation of H2 volumes, our EBITDA margins were momentarily impacted throughout the Spoton integration phase.”
From the 487-per-share IPO issue price, Delhivery shares have increased by more than 31%. The supply chain company’s first public offering (IPO) was 1.63 times oversubscribed, and on May 24, 2022, the stock was listed. A whole variety of logistics services, such as quick parcel delivery, large cargo delivery, and warehousing, are offered by Delhivery.
“Hi is the time when we put new capacity into service to get ready for the seasonally increased volumes in H2. We anticipate improved capacity utilization as PTL Freight volumes and Express Parcel shipments both continue to rebound, according to Ajith Pai, Chief Operating Officer of Delhivery.
Revenue from Part Truckload Services decreased by 16% YoY, from a pro forma revenue of 307 crore to Rs. 259 crore in Q1. One of the largest integrations in the Indian logistics sector, the company claimed it briefly impacted operations by completing the integration of Spoton, a complementing PTL business it had purchased in FY22.
PTL freight volumes for QIFY23 were 239,000 tonnes v/s 279,000 tonnes (proforma) in QIFY22 due to the staggered restarting of important customer accounts into the newly integrated network.
Sahil Barua, MD and Chief Executive Officer of Delhivery, stated, “As of June 30, 2022, we had over 6,000 crore in cash and investments, maintaining our exceptional level of capital. We will continue to invest in building infrastructure, technology, and operational capacity to deliver high-quality service to our customers.”
About Delhivery
Delhivery is a well-known supplier of logistics, supply chain management, and courier services who is enthusiastic about collaborating with both people and businesses. Delhivery, an Indian company established in May 2011 and its headquarters in Gurugram, Haryana, offers various services, such as last-mile delivery, transit and third-party warehousing, reverse logistics, payment collection, vendor-to-warehouse shipping, vendor-to-customer shipping, and more.
Times Internet Ltd., which purchased a minority investment in the company in June of last year, is the company’s backer.
With fulfilment, omnichannel, and data services as its three primary tasks, the company’s main goal is to provide the finest service possible without squandering any opportunities to address customers’ issues.
It offers goods and services designed to foster trust and enhance the quality of life for consumers, small businesses, enterprises, and their expanding team of partners and employees. Delhivery is revolutionizing India’s logistics industry with its distinctive network architecture, infrastructure, alliances, engineering, and technological prowess.
The 10,000+ consumers of Delhivery enjoy unparalleled cost-effectiveness and nationwide coverage. Delhivery’s mission is to make the world smaller for its consumers by reducing time and distance. Due to its carefully thought-out business plan, Delhivery is swiftly rising to the top of the supply chain and logistics sector. One of the courier and logistics firms that has expanded the options for product delivery is Delhivery, it can be mentioned. Additionally, Delhivery is driven by a constant focus on its customers and their desire to provide them with high-quality goods, which contributes to the legitimacy of the brand.
Delhivery – Industry
With the adoption of GST, the country’s $160 billion logistics sector is anticipated to increase by an estimated 10% CAGR and reach $215 billion in the following two years. However, most of the market was significantly fragmented into unorganized companies, and Delhivery’s entry may simply be described as a phenomenon that completely altered the sector and the way it operates.
With over 1400 usable pin codes and 19,990+ square feet of warehouse space in Delhi and Bangalore, this is where the company has its greatest reach. Delivery works with many partners to expand the product’s reach and manage these partners; the business also provides transit warehousing and third-party warehousing.
Along with managing its broad customer base of other companies and people, Delhivery also has many eCommerce firms as customers, including Flipkart, Amazon, eBay, Snapdeal, Jabong, and Healthkart.
Founders and Team
The company was started by a bunch of engineers – Bhavesh Manglani, Kapil Bharati, Mohit Tandon, Sahil Barua, and Suraj Saharan.
Startup Story
Suraj and Sahil placed a takeout order from a nearby Gurgaon eatery around half past eleven in the evening. As soon as the deliveryman reached their door, they began speaking with him, and he soon began discussing the looming unemployment issue. The founders ran to the store to speak with the manager as a result of this. They quickly arrived at the restaurant and spoke with the owner, who further explained his intentions to close the business and relocate his staff. Here is where Sahil and Suraj started their delivery business, Delhivery. Yes, they were all hired by them.
Funding and Investors
Fifteen investment rounds totalling $1.69 billion have been completed by Delhivery. The company acquired a capital round totalling $303.73 mn (Rs 2347 cr) before its initial public offering (IPO) on May 11, 2022, led by 64 anchor investors, including Steadview, Tiger Global, Bay Capital, and others. Delhivery distributed 48 million shares to the anchor investors for Rs 487 each, according to company documents.
The company obtained its previous round, which was headed by Addition, on September 24, 2021. As a result, it has raised around $125 million. On September 6, 2021, the company received financing totalling Rs 558 crore ($76.34 million). The round’s lead investor was Lee Fixel’s Addition LLC. Delhivery’s market worth was $4.77 billion as of May 2022.
The logistics giant gave 146,961 Series I Compulsory Convertible Preference Shares (CCPS) to Addition LLC for a price of Rs 37,900 per share, according to the brand’s MCA filings as of September 6, 2021.
Partnerships
Delhivery has thus far collaborated with numerous organizations. In August 2020, it will enter into a significant alliance with Volvo to broaden its express network to include tractor-trailers.
The first big tractor-trailer deployment in express trucking, according to Sahil Barua, co-founder of Delhivery: “This is a huge step for Delhivery towards getting ready for the future, towards growing our network, towards building our leading position in this industry further.”
Additionally, the company and FedEx Express have a strategic collaboration deal that was initially signed in July and will be formalized on December 9, 2021. This deal is thought to bring together Delhivery’s massive pan-India network and technological offerings with FedEx’s enviable worldwide network.
Competitors
- Ecom Express
- DotZot
- FSC (Future Supply Chain)
- BlackBuck
- Delex
- Delivery.com
- Ekart Logistics
- Shadowfax
Acquisitions
As of December 8, 2021, the corporation had acquired three firms. Delhivery acquired Transition Robotics on December 8, 2021, a California-based firm that was founded by Jeff Gibboney in 2011 and is now focusing on creating Unmanned Aerial Systems (UAS) platforms. This was Delhivery’s most recent purchase. According to CTO Kapil Bharati, the supply chain services startup will have the opportunity to collaborate directly with the core drone technology, whose “regulations and use cases” are “growing in the country.”
Delhivery has already given shareholders bonus shares as it prepares to file its Draft Red Herring Prospectus. The logistics and supply chain company said at its extraordinary general meeting (EGM) on September 29 that it would provide equity shareholders 1.68 Cr fully paid up bonus shares, each worth INR 10. The ratio will be 9:1.
The logistics unicorn boosted the total number of shares from 18,71,868 to 1,87,18,670 bonus shares by allocating 1,68,46,803 shares at Rs 10 each. 90 of the Corporation’s present equity stockholders would receive these shares, according to reports dated October 4, 2021.
The company’s founder, Sahil Barua, claims to own the greatest number of shares. 12.29 lakh bonus shares have been distributed by the firm. Times Internet and CPPIB, who received the largest number of shares allotted to corporate investors—28,53,040,000—are the other important shareholders.
Future plans
By spending up to Rs 300 crore on infrastructure improvements for the trucking business, Delhivery intends to increase the size of its fleet over the course of the next 24 months. Sources dated August 25, 2021, state that the company intends to make an initial public offering (IPO) with a $1 billion price tag.
The company estimates that its revenue for FY2020 will be Rs 2800 crore, and it expects to achieve Rs 6000–Rs 7000 crore in the next two years.
edited and proofread by nikita sharma
