Ecom Express files papers with SEBI for Rs 2,600 Cr IPO

Ecom Express Ltd has filed draft papers with capital markets regulator SEBI to garner Rs 2,600 crore through an initial share sale.

The company's initial public offering (IPO) comprises a fresh issue of equity shares worth Rs 1,284.50 crore and an offer for sale (OFS) of shares valued Rs 1,315.50 crore by promoters and other shareholders, according to the draft red herring prospectus (DRHP).

Proceeds from the fresh capital to the tune of Rs 387.44 crore will be used for setting up new processing centres with automation and new fulfilment centres, Rs 73.71 crore for computers and IT equipment, Rs 239.23 crore for enhancing technology, data science capabilities, and cloud infrastructure, and Rs 87.92 crore for payment of debt.

Also, the remaining funds will be used for general corporate purposes and potential acquisitions, according to the draft papers filed on Wednesday.

The company may consider raising Rs 257 crore through a pre-IPO placement. If such placement is undertaken, the amount raised will be deducted from the total fresh issue size.

Ecom Express operates a pan-India express logistics network that handles first-mile pick-up, mid-mile transportation, last-mile delivery, returns, and warehousing services. By offering essential logistics infrastructure and using technology, the company connects digital retailers and ecommerce platforms with consumers nationwide.

According to a RedSeer report, the Indian ecommerce market is projected to grow significantly, with a compound annual growth rate (CAGR) of 21% over the next five years. It is expected to increase from Rs 5.1 lakh crore in 2024 to Rs 12.5-13.5 lakh crore by 2029.

Growth is notably strong in Tier II+ regions, which are expected to account for 70-80% of B2C ecommerce shipments by 2029, up from 62% in 2024, the report added.

Axis Capital, IIFL Securities, Kotak Mahindra Capital Company, and UBS Securities India are the book-running lead managers to the company's public issue.