India’s Delhivery raises $300m from anchor investors; IPO subscribed 21% on Day 1

Visual from Delhivery website

IPO-bound logistics platform Delhivery has raised Rs 2,347 crore ($300 million) from 64 anchor investors, including private equity players Tiger Global Management, Steadview Capital and Bay Capital and Singaporean wealth funds Government of Singapore (GIC) and Monetary Authority of Singapore, VCCircle reported on Wednesday.

The IPO, which opened on Wednesday for three days, has decided to allocate 4,81,87,860 (4.81 crore) equity shares to anchor investors at Rs 487 apiece, aggregating to Rs 2,346.74 crore, according to information on BSE. On Day 1, the issue was subscribed 21%, with both the retail and institutional investor portions subscribed 29% each, Business Standard reported.

Existing investors Tiger Global Investments Fund, Alpha Wave Ventures (formerly Falcon Edge), GIC and Steadview Capital, which will not be selling shares in the IPO, picked up additional shares.

Global IPO activity has slowed down recently as the Russian invasion of Ukraine and rising interest rates spurred market volatility. After a spectacular run in 2021, India’s primary market has also been off to a slow start this year, with only three companies— Adani Wilmar Ltd, Vedant Fashions Ltd and AGS Transact Technologies Ltd — raising ₹7,819 crore ($1.08 billion) through IPOs so far, according to data from primary market tracker Prime Database. In comparison, there were 10 IPOs in the first two-and-a-half months of last year.

Going by the grey market premium, the much-awaited LIC issue is expected to list at a discount due to lukewarm response from foreign investors. However, Nomura Holdings expects IPO offerings in India to regain momentum in the second half of this year as indicated by increasing activity in secondary share sales.

“Delhivery is an IPO that should not be missed. They have done some incredible work in the space of logistics. Given the boom in e-commerce which promises to continue, they are well placed to significantly increase their share in the logistics space,” Anand Sanghvi, managing partner at GetFive Corporate Advisors, had told DealStreetAsia ahead of the IPO.

Delhivery competes with DHL’s unit Blue Dart Express and DTDC India in a sector that had a direct spend of $216 billion in fiscal 2020 and is expected to grow to $365 billion by fiscal 2026. It provides a wide range of logistics services, including delivery of express parcel and heavy goods, PTL freight, TL freight, warehousing, supply-chain solutions, cross-border express, freight services and supply-chain software.

Founded in 2011, Delhivery handles more than 1.5 million packages a day through its 43,000-strong team across India, according to its website. It became a unicorn in 2019 when it raised $413 million in a Series F round led by SoftBank Vision Fund and completed a series H funding round in June led by Fidelity.

The logistics player reported a net loss of Rs 891.13 crore with revenues of Rs 4,911.4 crore for the period ended December 31, 2021.

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