BLUE DART

BSE CODE 526612

Dalal Street Investment Journal - - REVIEWS -

We had rec­om­mended Blue Dart Ex­press (BDE) in Vol­ume 31 is­sue no. 24 dated Oc­to­ber 31- Novem­ber 13, 2016 un­der “Spe­cial Re­port” section when the scrip was trad­ing at ₹5105. Our rec­om­men­da­tion was backed by fac­tors such as strong mar­ket share, ex­cel­lent op­er­at­ing lever­age ex­pe­ri­enced by BDE and strong growth ex­pectancy of the in­dus­try. BDE is South Asia’s pre­mier courier and in­te­grated air ex­press pack­age dis­tri­bu­tion com­pany.

BDE has an ex­ten­sive do­mes­tic net­work cov­er­ing over 35,000 lo­ca­tions, and ser­vice more than 220 coun­tries and ter­ri­to­ries world­wide through its group com­pany DHL.

On the fi­nan­cial front, BDE posted a 7.2 per cent in­crease in its rev­enue to ₹666.66 crore in Q1FY18 from ₹621.37 crore in Q1FY17. More­over, the com­pany’s PBDT de­clined by 43.65 per cent to ₹43.75 crore in the first quar­ter of FY18 on a year on year ba­sis. The com­pany’s net profit too de­clined by

52.21 per cent to ₹21.09 crore for the first quar­ter of fis­cal year 2017 against the same pe­riod in the pre­vi­ous fis­cal year.

On an­nual ba­sis, the com­pany’s rev­enue rose by 4.97 per cent to ₹2680.87 crore in FY17 com­pared to the pre­vi­ous fis­cal. The com­pany’s PBDT de­creased by 22.06 per cent to ₹260.99 crore in FY17 on a yearly ba­sis. The com­pany’s net profit de­clined from ₹189.88 crore in FY16 to ₹139.57 crore in FY17. Weak in­vest­ments in the econ­omy ac­com­pa­nied by the gov­ern­ment’s de­mon­eti­sa­tion scheme and GST roll out have im­pacted the earn­ings of the com­pany, re­flect­ing in its stock mar­ket per­for­mance. The stock is cur­rently trad­ing at ₹4200 per share.

On ob­serv­ing the re­cent trend around the stock, the stock seems to be down­ward bent. We rec­om­mend our read­er­in­vestors to EXIT.

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