Exclusive: Ecom Express in talks to raise $40 Mn round led by Investcorp

Digital commerce focused logistics and warehousing firm Ecom Express is in advanced talks to raise up to $40 million in a fresh round, said three people aware of the discussions. Alternative asset management firm Investcorp is expected to lead the round while existing investors are likely to participate, they added.

If the talks materialize, this would be the second financing round for the Delhi-based company within a year. It raised $36 million in Series C round in Dec 2019. 

“Investcorp and Ecom Express have been engaged in talks for about six-seven weeks,” said one of the sources, requesting anonymity. “Investcorp would invest up to $25-30 million and it’s in the last leg to offer a term sheet to Ecom Express.”  

“Ecom Express could be valued in the range of $500-550 million,” said the second person. The person also requested anonymity.

The talks have come at a time when e-commerce focused logistics companies are all poised to witness a spike in shipments. With e-commerce companies all set for the upcoming festive period when they usually record bumper sales, logistics and warehousing companies are also preparing to handle the large scale operations.

With the festive season around the corner, Ecom Express has already hired 30,000 people to handle the spike in demand for its hubs and delivery centres. It also claims to have partnered with over 2,000 e-commerce companies. 

Ecom Express is one of the rare logistic companies to turn profitable in FY20. While the company is yet to file an annual financial report, the company claimed revenue of Rs 1,006 crore with an EBITDA of Rs 35 crore in the year ending March 2020.

According to its website, Ecom Express delivers to 27,000 pin codes across 2,650 cities. It employs over 36,000 people and has 2,932 facility centres. 

Responding to Entrackr’s queries, TA Krishnan, chief executive of Ecom Express, said, “we do not react to market rumours and speculation.” Queries sent to Investcorp didn’t elicit any response. We will update the post as and when they respond.

Flipkart-owned eKart, Delhivery, Xpressbees and Shadowfax were running in losses until FY19. Although they haven’t filed financials for FY20, they are likely to remain in the red in FY20 as well. 

Apart from Ecom Express, SoftBank-backed Delhivery has also been preparing for a   fresh round which could be a mix of primary and secondary capital. In December 2019, e-commerce and hyperlocal focused logistics firm Shadowfax raked in $60 million in a Series D round led by Walmart-controlled Flipkart.