Logistics tech unicorn, Delhivery, is next in line of IPO bound start-ups in India to file a draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (SEBI), and is looking to raise Rs 7,460 crore (nearly $1 billion), filings accessed by BusinessToday.In showed. Japanese tech investment giant, Softbank, which has a 22.7 per cent stake in the company, along with Carlyle Group (CA Swift Investments with a 7.42 per cent stake), and Times Internet Limited (5.10 per cent stake) will sell a part of their shareholding in the IPO, according to the DRHP. The company is seeking a valuation of $5 billion.
The IPO comprises a fresh issuance of shares aggregating up to Rs 5,000 crore and an offer for sale (OFS) comprising Rs 2,460 crore. Delhivery said that the company proposes to utilise the net proceeds towards funding organic growth initiatives, acquisitions, strategic expansions and general corporate purposes.
The company said that it doesn’t intend to go for a pre-IPO placement round before the IPO. Delhivery’s revenue from operations grew to Rs 3,838 crore in FY21 from Rs 2,988 crore in FY20. For the quarter ended June, Delhivery’s income stood at Rs 1,364 crore.
Despite bringing down its expenses substantially since FY19, the logistics firm’s losses widened by as much as 35 per cent in FY21 which stood at Rs 415 crore as against the losses of Rs 268 crore in FY20. For the June quarter, the losses were reported at Rs 129 crore.
The losses ballooned on account of increase in freight, handling and servicing costs, purchase of traded goods, and employee benefit expenses, among others.
The company said in its filing that it operated a pan-India network and provided services in 17,045 PIN codes, as of June 30. It also provided supply chain solutions to a diverse base of 21,342 active customers such as e-commerce marketplaces, direct-to-consumer e-tailers and enterprises and SMEs across several verticals such as FMCG, consumer durables, consumer electronics, lifestyle, retail, automotive and manufacturing, in the three months ended June 30.
Delhivery operated 20 fully and semi-automated sortation centres and 86 gateways across India (excluding Spoton) as of June 30. It had a rated automated sort capacity of 3.17 million shipments per day as of June 30, which it further enhanced to more than 3.98 million shipments per day as of September 30. The company has automated material handling systems at its gateways in Tauru (Haryana), Bhiwandi (Maharashtra) and Bengaluru (Karnataka), as per the filing.
As per a RedSeer report, the Indian logistics market presents a large addressable opportunity, with direct spends on logistics of $216.0 billion in FY20 and is expected to grow to approximately $365 billion by FY26 at a CAGR of 9.1 per cent. This growth will be driven by strong underlying economic growth, a favourable regulatory environment, growth of domestic manufacturing, rapid growth of the digital economy, and improvements in India’s transportation infrastructure. Within the logistics industry the express parcel delivery segment, which is highly organised, is expected to grow at a CAGR of approximately 28-32 per cent by value to $10-12 billion by FY26.
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