IPO-bound udaan acquires retail-tech startup ShopKirana
Following the acquisition, ShopKirana investors will join Udaan’s cap table. The company's founding team and its entire workforce will be integrated into udaan’s operations.
B2B ecommerce unicorn udaan has acquired retail-tech startup ShopKirana in an all-stock transaction, as it looks to accelerate its offerings and scale ahead of a planned public debut.
The acquisition, subject to regulatory approvals, will see Info Edge join udaan as a shareholder. Other ShopKirana investors including Sixth Sense Ventures, Oman India Joint Investment Fund, and Incubate Fund will also hold stakes in the combined entity. The deal values ShopKirana at the same valuation from its last fundraise.
Founded in 2015 by Deepak Dhanotiya, Sumit Ghorawat, and Tanutejas Saraswat, ShopKirana works with over 50,000 kirana stores across Madhya Pradesh, Uttar Pradesh, Rajasthan, and Gujarat.
ShopKirana's founding team, as well as its entire team, is expected to be operated within Udaan.
Dhanotiya and Saraswat, the co-founders of ShopKirana, told YourStory that they have built a capital-efficient, FMCG-first business focused on Tier II markets, with FMCG accounting for 90 per cent of operations. udaan, on the other hand, has scaled across larger cities with a broader category mix, placing more emphasis on staples. This partnership brings together complementary strengths, including strong house brands, they added.
ShopKirana primarily provides retailers with a tech-enabled procurement platform,, and partners with FMCG brands to offer a go-to-market solution in under-served general trade markets, especially in Tier II cities and smaller towns.
"This merger marks a significant step towards consolidating the leadership position of the combined udaan-Shopkirana entity in the sector. It unlocks meaningful synergies across FMCG and private label operations, with deepening presence in key clusters which will drive operating leverage," said Kitty Agarwal, Partner, InfoEdge Ventures.
These developments come on the heels of Udaan's $114-million fundraise last month. The Bengaluru-based company secured fresh funding in a round led by M&G Investments and Lightspeed Venture Partners. The company plans to use the capital in the fast-moving consumer goods (FMCG) and HoReCa (hotels, restaurants, and catering) segments, to build private-label offerings.
"This acquisition is a strategic milestone in our journey to the IPO and beyond. ShopKirana has a quality team, who have worked in-depth on the FMCG category and excelled at designing for costs. Together, we share the belief in winning by becoming a 'preferred supplier to our shopkeepers' and 'preferred partner to brands'. We also share the core strategy of 'winning on costs'," said Vaibhav Gupta, Co-Founder and CEO, udaan, in a press note.
The company, which competes with players like Jumbotail and ElasticRun, clocked 60% year-on-year growth in the calendar year 2024, alongside a 300 basis point improvement in contribution margin. During the same period, it reduced fixed costs by 20%, contributing to a 40% decline in EBITDA burn. Since the beginning of 2025, it has clocked an additional improvement of 100 bps in contribution margin.
Edited by Swetha Kannan