Royal Mail PLC (LSE:RMG) has benefited greatly from the Covid-19 pandemic increasing demand for parcels and is now set to get another boost, according to Barclays.

Analysts at the bank noted that the UK government has just updated its COVID testing guidance.

New advice from Cabinet Office is for people to take rapid lateral flow tests before going somewhere ‘high risk’, such as meeting clinically vulnerable people or visiting crowded and enclosed spaces.

Barclays said this increased the frequency of testing from its previous guidance of twice per week.

The bank’s share price target is 550p, versus the last closing price of 509p.

This is “likely” to benefit Royal Mail’s UK volumes in the near term as testing kits are a tracked 24/48 product.

This note came out on the same day as Citizens Advice called for regulator Ofcom to introduce tougher rules for the delivery sector, including fines for negligence if deliveries go wildly astray.

A survey from Citizens Advice found not one delivery firm received more than three out of five stars, with Amazon Logistics and Royal Mail scoring the highest but both with less than three stars.

Hermes, with 1.5 stars, and Yodel, with 1.75, performed the worst.

Royal Mail scored two starts for accessibility and 2.5 for customer service.

Citizens Advice said: “Our findings show it’s time for Ofcom [the regulator] to come forward and introduce tougher rules across the board for delivery companies.”

It is calling for stricter rules for parcel companies, better complaints processes, and fines from the regulator if negligence leads to parcels getting lost or stolen.

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