Delhivery share price: what was the company forecast that caused the rout?

New-age logistics firm Delhivery’s stock continued to nosedive for a second day after the company reported a muted growth outlook. The scrip was down almost 18% on Friday on the BSE after falling 15% on Thursday.

How have Delhivery’s shares been faring?

Delhivery shares are trading at Rs 386.95 apiece, down nearly 18% from their previous close on the BSE on Thursday. This is a record low for the stock after it listed on the bourses in May. On Thursday, the stock fell below the issue price of Rs 487 for the first time.


Why are Delhivery shares falling?

Delhivery, in a stock exchange filing, had said it is likely to see moderate growth in shipments for the rest of the financial year. “While the festive season sale surge in shipment volumes will spill over to the third quarter as well, we anticipate moderate growth in shipment volumes through the rest of the financial year,” the company had said in its filing.

Why are the company’s comments important?

Delhivery's forecast is of significance as it is the largest third-party logistics player in the ecommerce space and is seen as a proxy for online consumption and demand trends. The company said that discretionary spending by consumers during April-September period had been muted because of high inflation levels, with average user spending and total active shoppers staying flat or lower.
As per the latest available data, India's annual retail inflation accelerated to a five-month high of 7.41% in September from 7% in the previous month. This tepid demand environment, Delhivery implied, would continue in the second half and impact its performance.

How are other tech stocks performing?

According to the ETIG database, shares of companies on the ET Ecommerce Index have underperformed the broader markets over the last month. As of Friday, the ET Ecommerce index was down 8.57% for the 30-day period, compared to a 1.42% fall in the benchmark Nifty 50 index. Over a six-month period, the ET Ecommerce index was down 22.24%, while the Nifty 50 was up 5.05%.