Logistics unicorn Delhivery has pruned its initial public offering (IPO) by around 30% to Rs 5,235 crore ($686 million) from the earlier Rs 7,460 crore ($977 million), its Red Herring Prospectus (RHP) said.
This comes amid volatile equity market conditions and ahead of the big Rs 21,000-crore issuance from Life Insurance Corporation of India (LIC) this week.
The price band for the IPO is likely to be around Rs 462-487 a share. Earlier, the firm had said its IPO will open for subscription on May 11 and close on May 13.
According to the RHP filed, of the total IPO size, the fresh issuance of shares will now be made for Rs 4,000 crore ($525 million) while the offer for sale (OFS) portion has been reduced to Rs 1,235 crore ($162 million). Earlier the OFS was targeting at Rs 2,460 crore ($322.5 million).
The proceeds from the issue will fund the company's inorganic growth plans via acquisitions and organic plans with focus on automation, technology and other strategies.
Kotak Mahindra Capital, Morgan Stanley India, Bofa Securities India, and Citigroup Global Markets are managing the share sale.
Under the OFS, its shareholders including US private equity firm Carlyle, Japanese Softbank, Fosun group-owned China Momentum Fund and Times Internet will divest their ownership in the logistics company.
Carlyle will sell shares worth Rs 454 crore from earlier plan to sell Rs 920 crore through its affiliate CA Swift Investments; SoftBank via its investment vehicle SVF Doorbell (Cayman) Ltd will now sell a stake worth Rs 365 crore, down from Rs 750 crore.
Fosun will sell via Deli CMF Pte Ltd, shares worth Rs 200 crore, half from earlier Rs 400 crore sale plan and Times Internet will sell up to Rs 165 crore from previously.
In addition, Delhivery's co-founders -- Kapil Bharati (also its chief technology officer), Mohit Tandon and Suraj Saharan-- will sell shares worth Rs 5 crore, Rs 40 crore and Rs 6 crore, respectively.
With a 22.78% stake, SoftBank is the largest shareholder in Delhivery, while Nexus Ventures and Carlyle hold stakes of 9.23% and 7.42%, respectively. The company’s three founders hold relatively small stakes. While Kapil Bharati holds 1.11%, Mohit Tandon owns 1.88% and Suraj Saharan has a 1.79% stake.
Delhivery had last raised $125 million in September from former Tiger Global executive Lee Fixel’s Addition at a reported valuation of $3.2 billion. It became a unicorn in 2019 when it raised $413 million in a Series F round led by SoftBank Vision Fund.
An end-to-end logistics solution, including warehousing services and other value-add services, Delhivery's shipment volumes in FY21 stood at 289.2 million.
The Gurgaon-based decade old start-up also has significant cash reserves of over Rs 3,000 crore on its balance sheet. It has made around seven acquisitions and continues to do so.
Delhivery was founded in 2011 by Sahil Barua, Mohit Tandon, Bhavesh Manglani, Suraj Saharan, and Kapil Bharati as a hyperlocal express logistics services firm in Delhi.
For the nine months ended December 2021, it reported a loss of Rs 891.1 crore, higher than the loss of Rs 297.5 crore posted in the corresponding period of 2020.
The company’s total income for the nine months to December 2021 was Rs 4,911.4 crore as compared with Rs 2,806.5 crore in the year-ago period in 2020.
As on December end 2021, it claims to have delivered 1.2 billion parcels providing services to over 17,045 postal index number (PIN) codes, as of June 30, 2021.
