Are Delhivery Ltd latest results good or bad?

Delhivery Ltd's latest financial results for Q3 FY26 reflect a significant turnaround in net sales and profitability compared to the previous quarter. The company reported net sales of ₹2,804.99 crores, which represents a year-on-year growth of 17.94% and a sequential growth of 9.60%. This increase indicates strengthening demand for logistics services, particularly driven by the festive season and year-end e-commerce activity. In terms of profitability, Delhivery achieved a net profit of ₹39.61 crores, marking a notable recovery from a loss of ₹50.38 crores in Q2 FY26. The operating margin, excluding other income, improved substantially to 7.44%, up from 2.66% in the previous quarter, showcasing operational improvements and better capacity utilization. However, the results also highlight ongoing concerns regarding the sustainability of profitability. The company's reliance on other income, which constituted a significant portion of profit before tax, raises questions about the quality of earnings. The core operations, when excluding this income, reported a loss before tax of ₹13.08 crores, indicating challenges in achieving consistent operational profitability. Delhivery's return on equity (ROE) remains low at 0.45%, and its return on capital employed (ROCE) is negative, suggesting inefficiencies in capital deployment. Despite the positive revenue growth and margin expansion, these metrics underline the company's struggle to create shareholder value. Overall, while the latest results indicate operational momentum and a recovery from previous losses, the volatility in profitability and concerns over capital efficiency remain critical factors for investors to consider. The company experienced an adjustment in its evaluation, reflecting the mixed nature of its financial performance.