Delhivery IPO to Open on May 11; Price range set at ₹462-487 per share


The three-day initial sale of shares will end on May 13 and the call for anchor investors will open on May 10

The three-day initial sale of shares will end on May 13 and the call for anchor investors will open on May 10

Supply chain company Delhivery announced on Thursday that it had set a price range of £462 to £487 per share for its £5,235 million initial public offering (IPO), which will open for subscription on May 11.

At the higher end of the price range, the company is valued at ₹35,284 crore, Delhivery announced in a virtual press conference.

The three-day initial sale of shares will end on May 13 and the call for anchor investors will open on May 10.

The size of the IPO was reduced from a previously planned ₹7,460 billion to ₹5,235 billion. The public offering now includes a new share issue of ₹4,000 crore and an Offer for Sale (OFS) component of ₹1,235 crore by existing shareholders.

As part of the OFS, investors Carlyle Group and SoftBank and the co-founders of Delhivery will divest their stake in the logistics company.

CA Swift Investments, a Carlyle Group company, will sell ₹454 crore of shares, while SVF Doorbell (Cayman) Ltd, a division of Softbank Group, will sell ₹365 crore of shares.

Deli CMF Pte Ltd, a wholly owned subsidiary of private equity fund China Momentum Fund, LP, will sell shares worth ₹200 crore and Times Internet will sell shares worth Rs 165 crore.

In addition, Delhivery co-founders – Kapil Bharati, Mohit Tandon and Suraj Saharan – will sell shares worth ₹5 crore, ₹40 crore and ₹6 crore respectively.

Currently, SoftBank owns a 22.78 percent stake, Carlyle a 7.42 percent stake, Bharti a 1.11 percent stake, Tondon a 1.88 percent stake and Saharan a 1.79 percent stake in the company.

Proceeds from the reissue of 2,000 crore will be used to fund organic growth initiatives and 1,000 crore for inorganic growth through acquisitions and other strategic initiatives, in addition to general corporate purposes.

According to the company, 75 percent of the issue is reserved for qualified institutional investors, 15 percent for non-institutional investors and the remaining 10 percent for retail investors. In addition, the Company has reserved shares worth ₹20 crore for eligible employees who will receive a discount of ₹25 per stock share during the bidding process.

Investors can bid for a minimum of 30 shares and multiples thereof.

From logistics to value-added services

Delhivery provides a full range of logistics services including express parcel delivery, heavy lift delivery, warehousing, supply chain solutions, cross-border express and freight services and supply chain software, as well as value-added services such as e-commerce return services, collections and processing, installation and assembly.

The e-commerce logistics company operates a pan-India network and offers services in 17,045 postal code (PIN) codes.

The company’s express parcel delivery network, which served 17,488 PIN codes in the nine months ended December 2021, covered 90.61 percent of the 19,300 PIN codes in India.

The company provides supply chain solutions to a diverse base of 23,113 active customers such as e-commerce marketplaces, direct-to-consumer e-tailers, as well as enterprises and SMBs across multiple industries including FMCG, durable consumer goods, consumer electronics, lifestyle and retail, Automotive and Manufacturing.

The Gurugram-based company said about five customers contributed to more than 40 percent of its sales in FY21.

Referring to the company’s key business strategies, Delhivery Executive Director and Chief Business Officer said the company will focus on expanding infrastructure and network investments while continuing to expand existing business areas, deepen customer relationships, enhance technological capabilities and expand high growth international markets, similar to India, and pursue strategic alliances and select acquisitions and investment opportunities.

Kotak Mahindra Capital Company, BofA Securities India, Morgan Stanley India Company and Citigroup Global Markets India are the lead bookers of the offering.

The supply chain company’s shares will be listed on the stock exchanges – BSE and NSE – on May 24.

In August, Delhivery acquired Spoton to further expand its part truck (PTL) freight service business.

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