Udaan receives $30 Mn from holding company

B2B e-commerce platform Udaan has received around $30 million from its Singapore-based parent entity Trustroot Internet Private Limited, making it the largest deployment from its holding company till date.

The company has been in the headlines for raising back to back funding rounds, jumping valuation and the expenditure versus revenue figures it reported in the last fiscal year. 

According to a regulatory filing with the Ministry of Corporate Affairs, Udaan passed a special resolution to allot 2,43,161 Class A equity shares of Rs 8848.4 per share to Trustroot for a total consideration of Rs 215.15 crore (~$30 million).

Sitting on a pile of $870 million in risk capital, the Bengaluru-based company has been receiving funds regularly from its parent, the last three tranches of $10 million, $5 million and $20 million received in July 2019, June 2019 and May 2019 respectively.

The deployment of fresh funds comes at a time when Udaan’s direct competitors in this space including - Jumbotail, Moglix and ShopKirana - are trying to narrow the gap as the leader is far ahead in expanding its business.

Udaan connects retailers with wholesalers and traders who sell more than 15 lakh products ranging across categories from electronics and apparel to grocery and fresh produce.

Till date, it claims to have 20,000 sellers and 10 lakh retailers from 900 cities and towns in India. Apart from the marketplace model, it also offers logistics services along with working capital loans to the sellers on the platform.

Backed by the likes of Tencent, Lightspeed and Hillhouse, Udaan had gathered a $585 million Series D round in October 2019. The valuation of the company surged 2.8X to $2.8 billion in that round from $1 billion in a Series C round in August 2018.

Interestingly, Udaan had valued itself at $7.5 billion in its valuation report in September 2019. Unlike the actual valuation, i.e. $2.8 billion, the projected valuation by the company was based on cash flows and equity infusions. 

While the valuation report by Udaan had surprised many, its performance in the last financial year was not up to the mark. 

The company spent Rs 849 crore to make Rs 46.36 crore as operational revenue during FY19. As a result, it ended up making a loss of around Rs 779.5 crore in the fiscal year.