Logistics major Delhivery outlined its long-term growth targets at its analyst meet on Monday. Among the targets include its express delivery business to deliver adjusted EBITDA growth in the high teens.

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Delhivery reported adjusted EBITDA margin of 0.3 percent in the March quarter, after three consecutive quarters of negative margins in financial year 2023. It managed to turn operationally profitable on an adjusted basis after margins improved from a negative 12.5 percent last year.

Meanwhile, brokerage firm Morgan Stanley has held an ‘Overweight’ rating on Delhivery and at a price target of Rs 415 per share.

At Delhivery’s current price, the target set by Morgan Stanley indicates a potential upside of 16.44 percent. The brokerage firm has reiterated good long-term growth prospects for the company along with key competitive moats.

Morgan Stanley believes that the targeted EBITDA margin has the potential for pre-tax return on capital employed (RoCE) of more than 30 percent.

Kotak Institutional Equities has also retained ‘buy’ rating on the stock with a price target of Rs 410 apiece, indicating a potential upside of 15 percent from current levels.

The firm observed that the logistics firm’s focus on building an automated ‘mesh’ network (which means option of direct routes across any two points) will enable it to capture a bigger pie of India’s logistics market.

For the quarter ended March 2023, Delhivery reported a net loss of Rs 158.67 crore, and its net sales reduced by 10.24 percent to Rs 1,859.63 crore compared to Rs 2,071.76 crore in the year-ago period.

Shares of Delhivery ended little changed at Rs 355.30.