Hold Blue Dart, target Rs 1,973: ICICI Securities

ICICI Securities has upgraded Blue Dart to hold from sell and revised target price down to Rs 1,973 from Rs 2,040. Shares of Blue Dart Express ended down 3.3 per cent at Rs 1,992.6 on Friday while BSE Sensex closed 131.18 points down (-0.44 per cent) at 29,815.59.

Blue Dart Express Ltd., incorporated in 1991, has a market cap of Rs 4728.03 crore, operating in Logistics sector.


Investment Rationale


The brokerage has reduced earnings estimates on Blue Dart for FY21 by 86 per cent to account for a quarter of disruption in business activity. A possible Soft-Bank stake sale in Delhivery (yet unconfirmed) can help improve profitability of the entire express logistics space in India including air express, said ICICI Securities.

Financials


Blue Dart Express' key products/revenue segments include Service Charges which contributed Rs 2790.85 crore to sales Value (100 per cent of total sales)for the year ending March 31, 2018.

For the quarter ended December 31, 2019, the company reported consolidated sales of Rs 857.86 crore, up 6.94 per cent from last quarter sales of Rs 802.17 crore and up .02 per cent from last year same quarter sales of Rs 857.66 crore. The company reported net profit after tax of Rs -31.92 crore in the latest quarter.