Delhivery has announced strategic cost optimization targets as part of its operational efficiency drive, setting clear benchmarks for corporate expense reduction and profitability milestones.

Corporate Cost Reduction Strategy

The logistics company expects to achieve significant cost optimization by reducing corporate costs from the current 9.1% recorded in Q3 FY26 to a target range of 6%-7%. This represents a substantial reduction that could enhance the company's operational efficiency and bottom-line performance.

Free Cash Flow Break-Even Target

Delhivery has set a clear profitability milestone, aiming for free cash flow break-even at approximately 6% adjusted EBITDA margin. This target reflects the company's commitment to achieving sustainable cash generation while maintaining operational growth.

Strategic Focus on Operational Efficiency

The announced targets demonstrate Delhivery's strategic emphasis on:

• Cost structure optimization through corporate expense reduction
• Margin improvement via operational efficiency gains
• Cash flow sustainability with clear break-even targets
• Profitability pathway aligned with adjusted EBITDA metrics

These financial targets indicate the company's focus on balancing growth investments with profitability objectives, positioning itself for sustainable long-term performance in the competitive logistics sector.

Delhivery has provided comprehensive guidance on its growth trajectory and margin expansion plans, highlighting strong volume projections and significant improvements in its Part Truck Load (PTL) segment profitability.

Volume Growth Projections

The company has outlined robust long-term volume growth expectations despite acknowledging potential quarterly variations. Delhivery projects long-term volume growth around 20%, demonstrating confidence in sustained market demand and operational capabilities.

The company's volume growth strategy encompasses both its express parcel segment, which maintains projections of 15%-20% growth, and broader logistics operations that support the overall 20% long-term target.

PTL Margin Expansion Strategy

Delhivery has outlined significant margin improvement plans for its PTL business segment. The company expects PTL margins to rise beyond the current 11% level, targeting over 16% through strategic operational enhancements.

The margin expansion is expected to be driven by two primary factors: improved network utilization efficiency and strategic price revisions across the PTL segment.

Capital Expenditure Framework

Maintaining its disciplined approach to capital allocation, Delhivery continues to project a gradual decline in CAPEX intensity. The company expects capital expenditure to decrease to a range of 4%-4.4% over the next 7-10 quarters.

Strategic Outlook

The updated projections reflect Delhivery's comprehensive growth strategy, combining volume expansion with margin enhancement. The company's focus on network optimization and pricing discipline in the PTL segment, alongside sustained volume growth expectations, positions it for improved profitability while maintaining competitive market positioning.