Delhivery, a prominent player in the logistics sector, has expanded its employee stock option plan (ESOP) pool by allotting a significant 11.06 lakh shares. This move underscores the company’s commitment to incentivizing and rewarding its employees while aligning their interests with the company’s growth trajectory.
Allocation Breakdown
The allocation comprises over 2.85 lakh equity shares under the Delhivery ESOP 2012 scheme, over 3.49 lakh equity shares under ESOP II 2020, and over 4.70 lakh equity shares under the ESOP III 2020 scheme. The decision was ratified by the Stakeholders’ Relationship Committee of Delhivery Limited, as per an exchange filing dated June 10, 2024.
Impact on Share Capital
With the latest allotment, Delhivery’s paid-up share capital is set to increase to INR 73.85 crore from its previous figure of INR 73.74 crore. This expansion reflects the company’s ongoing efforts to enhance employee participation and ownership in its growth journey.
Valuation Insights
Based on the last closing price of Delhivery’s stock, the newly allotted ESOPs are valued at nearly INR 43 crore, highlighting the substantial benefits accruing to employees through this equity-based incentive program.
Financial Performance Context
The expansion of the ESOP pool comes amidst Delhivery’s financial performance dynamics. In the fourth quarter (Q4) of the financial year 2023-24 (FY24), the company reported a consolidated net loss of INR 69 crore, a significant deviation from the net profit of INR 11.7 crore recorded in the preceding quarter. The decline in revenue from operations by 5% quarter-to-quarter to INR 2,076 crore in Q4 can be attributed to decreased volumes in express parcel and cross-border services.
Strategic Initiatives
Despite the financial performance challenges, Delhivery remains focused on innovation and expansion. The establishment of a wholly-owned subsidiary, Delhivery Robotics India, aimed at manufacturing drones and providing freight air transportation services, underscores the company’s commitment to leveraging emerging technologies to enhance its operational capabilities and service offerings.
Industry Trends
Delhivery’s move to expand its ESOP pool aligns with a broader trend observed among listed new-age tech companies. Notable players like Paytm and PB Fintech have also announced significant ESOP allotments recently, signaling a growing recognition of the importance of employee ownership and motivation in driving organizational success.
Market Response
Delhivery’s shares experienced a marginal decline of 0.68% in Tuesday’s trading session, closing at INR 387.45 on the BSE. Despite short-term market fluctuations, the company’s long-term growth prospects and strategic initiatives continue to position it favorably in the competitive landscape.
