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19 Nov 2024
SoftBank-backed OfBusiness, an Indian B2B e-commerce platform that supplies raw materials to businesses, is gearing up for an Initial Public Offering (IPO) in India valued at up to $1 billion. The company is nearing the final stages of appointing bankers for the IPO, Chief Financial Officer Bhavesh Keswani told Reuters.
The company is in active discussions with major financial institutions, including Bank of America, Citi, JP Morgan, and Morgan Stanley, to manage the IPO. OfBusiness aims to list on Indian stock exchanges in the latter half of 2025, Keswani mentioned. The IPO is expected to raise between $750 million and $1 billion, comprising approximately $200 million in new shares, with the remaining shares being sold by current shareholders to new investors.
Keswani stated that the funds raised from the IPO will be allocated towards repaying debt and expanding the company’s existing operations. This marks the company’s first public disclosure regarding its IPO plans. The four banks declined to comment on the matter when contacted by Reuters.
SoftBank Group, a Japanese tech investor, and U.S.-based investment firm Tiger Global collectively hold about a 15% stake in OfBusiness. Meanwhile, Alpha Wave Global, an international investment firm, owns around 18%. The company is targeting a valuation between $6 billion and $9 billion, according to an industry insider familiar with the plans, although Keswani did not comment on the valuation target.
Founded in 2015 by the husband-and-wife duo Asish Mohapatra and Ruchi Kalra, OfBusiness has raised over $800 million from various investors to date. The company’s last funding round in 2021 valued it at approximately $5 billion. OfBusiness is moving forward with its IPO plans amid a strong performance in the Indian stock market, where the benchmark index has surged by 16% this year, outperforming other Asian markets.
Recently, another SoftBank-backed company, Ola Electric, went public in India, and Hyundai Motor is also preparing for a $3 billion IPO later this year. As a B2B online platform, OfBusiness offers a range of products, including polymers, agricultural goods like pulses, and industrial steel from companies such as Tata Steel. India's manufacturing and construction sectors are currently experiencing significant growth, driven by the country's status as the world's fastest-growing major economy.
For the fiscal year 2024, which ended in March, OfBusiness reported an after-tax profit of $72.6 million on revenues of $2.3 billion. Keswani also noted that the company is in the process of merging some of its subsidiaries to streamline operations in preparation for the IPO.
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