Ecom Express, Backed by Warburg Pincus, Partners Group, and British International Investment, Seeks Rs 2,600 Crore in IPO

India IPO

Updated Aug 15, 2024

Ecom Express IPO is a combination of fresh issuance of shares worth Rs 1,284.5 crore, and an offer-for-sale (OFS) of up to Rs 1,315.5 crore by promoters and investor.

Ecom Express, Backed by Warburg Pincus, Partners Group, and British International Investment, Seeks Rs 2,600 Crore in IPO

Ecom Express, a B2C e-commerce logistics provider based in Gurugram and supported by Warburg Pincus, Partners Group, and British International Investment, has submitted its draft red herring prospectus to SEBI to raise Rs 2,600 crore through an IPO.

The offering includes a fresh issuance of Rs 1,284.5 crore in shares and an offer-for-sale (OFS) of up to Rs 1,315.5 crore by existing shareholders.

Promoters such as Kotla Satyanarayana, Manju Dhawan, Kotla Sridevi, Kotla Rathnanjali, and corporate entities like Eaglebay Investment and PG Esmeralda Pte will sell shares worth Rs 1,160.84 crore through the OFS.

British International Investment plc will sell Rs 136.97 crore worth of shares, with additional shares being offered by Jayanti Krishnan, Rabeya Saxena, and Saheba Saxena.

Eaglebay Investment is linked to Warburg Pincus, and PG Esmeralda Pte is part of the Partners Group. Ecom Express may also raise up to Rs 256.9 crore through pre-IPO placements, which will be deducted from the fresh issue amount.

The promoters hold 82.99% of Ecom Express, with the remaining 17.01% owned by public shareholders, including British International Investment plc’s 10.03% stake. The company plans to allocate Rs 387.44 crore for new processing and fulfillment centers, Rs 73.7 crore for IT equipment, and Rs 239.2 crore for enhancing its technological and data science capabilities. An additional Rs 87.92 crore will be used to repay debt, with remaining funds going towards general corporate purposes and possible acquisitions.

For FY24, Ecom Express reported a net loss of Rs 248.5 crore, a reduction from the previous year’s loss of Rs 359.85 crore, while revenue increased by 2.2% to Rs 2,609.2 crore. The company improved its EBITDA loss to Rs 4.8 crore from Rs 49.7 crore, compared to an EBITDA profit of Rs 83.3 crore in FY22.

Ecom Express serves major clients such as Meesho, Amazon, and Nykaa, and as of March 2024, has 6,384 active customers. The B2C e-commerce market in India is projected to grow at a 21% CAGR over the next five years, reaching Rs 12.5 – Rs 13.5 lakh crore by FY29. Growth in B2C e-commerce shipments is particularly strong in Tier 2+ regions.

Axis Capital, IIFL Securities, Kotak Mahindra Capital Company, and UBS Securities India are the lead merchant bankers for the IPO.