IPO: Ecom Express sets the ball rolling for Rs 3,000-cr IPO

Mumbai: Warburg Pincus-backed Ecom Express is looking to enter the primary market with a ₹3,000-crore initial public offering (IPO), according to two people aware of the development. The third-party logistics company has appointed bankers including Kotak Capital, IIFL, Axis Capital, and UBS, according to one of the sources.

“Ecom Express has initiated the process for the public issue, which includes both a fresh issue and an offer for sale from the existing investors. The company is likely to file its draft red herring prospectus soon,” said one of the people cited above.

Warburg Pincus holds a 33.76% stake in Ecom Express, while Switzerland-based Partners Group and British International Investment own 17.57% and 6.48% stakes, respectively. Ecom Express did not respond to ET’s queries.

The Gurugram-based Ecom Express, which competes with Delhivery and XpressBees, as well as Flipkart’s Ekart Logistics and Amazon Transportation Services, deferred its planned public listing in 2022 due to tough market conditions.

About 8 startup companies, including Paytm, Nykaa, Zomato, Nazara Technologies, CarTrade, and EaseMyTrip, successfully launched their IPOs in 2020 and 2021. However, due to the poor performance of these IPOs post-listing, only a few, like Delhivery and Tracxn, succeeded in raising funds through public issues in 2022, while the rest postponed their plans.Delhivery, which was listed in May 2022, is currently trading at ₹400, 20% lower than its IPO price of ₹487.Ecom Express reported a 20% increase in revenue to ₹2,548 crore in FY23. The company reported a loss of ₹375 crore in FY23 compared to a loss of ₹91 in FY22. The company’s expenses rose about 30% to ₹2,856 crore in FY23.On June 25, ET reported that the company is looking to raise ₹1,424 crore through a rights issue likely to be led by its existing investors, such as Warburg Pincus, British International Investment (BII), and Partners Group.

The company’s shareholders have passed a resolution for the rights issue totalling 1.57 million compulsorily convertible preference shares at ₹9,071 apiece – the same price at which Ecom Express did a rights issue in July last year, according to regulatory filings with the Registrar of Companies (RoC), as reported by ET.