The logistics services firm Shadowfax is looking to enter the IPO stage to grow. It has claimed that its post-IPO valuation will be between INR 5,000 to INR 8,000 crore; therefore, it plans to raise about INR 2,500-3,000 crore through it.
Shadowfax’s Journey
Shadowfax was launched in the year 2015 by Vaibhav Khandelwal and Abhishek Bansal and the company deals in hyper-local as well as on-demand delivery space primarily targeting SMEs. It is a fashion-conscious startup that proactively provides last-mile connection solutions to leading e-tailing platforms like Flipkart and Meesho. The large number of delivery companies in its fold helps it offer timely and efficient delivery services to cater to the new demands of quick delivery in the contemporary business world.
Series E Funding Round and IPO
In February this year, the company undertook the Series E funding round through which Shadowfax received $100 million. TPG NewQuest led the investment, and other investors included Mirae Asset Venture Investments India, Flipkart, IFC, Nokia Growth Partners, Qualcomm, and Trifecta Capital. Significantly, Eight Roads Ventures, an institutional investor since 2015, is also partially out in this round.
Basking in the latest funding campaign, Shadowfax is now planning for an IPO. The company is actively planning to approach the primary market as evidenced by early meetings with merchant bankers. The IPO should be used to mobilize a significant amount of capital and at the same time boost Shadowfax’s dominance in the logistics industry.
Stiff Competition from Others
Some key competitors in the Shadowfax business environment include Delhivery, Ecom Express, XpressBees, LoadShare, Ripple, and Pickrr. However, as e-commerce and delivery change, it can be difficult to keep up with new developments. Nonetheless, the established network, technological services, and proper partnerships make Shadowfax ready to overcome these challenges.
However, it appears Shadowfax is not alone in the logistics industry to tap the IPO market. Another prominent third-party logistics company, Ecom Express, is also planning for an IPO of INR 3,000 crore. This competition brings diversity and excitement to the IPO of players in the logistics sector.
Financial Performance
In the fiscal year 2022–23 (FY23), Shadowfax posted a net loss of INR 142.63 crore thus depicting a 19% YoY increase. At the same time, its total income increased by 42% YoY to INR 1,423 crore. These financial ratios reveal the firm’s dynamic growth path and capacity to manage expansion while containing financial risks.
Key Factors Driving Shadowfax’s growth
Shadowfax works with leading online marketplaces such as Flipkart and Meesho. Such relationships ensure a continuous supply of consumers and support the company’s expansion. They operate hyper-local and on-demand delivery solutions, specifically in and around cities. It maintains a vast network of delivery partners that help in quick and efficient last-mile deliveries to customers as required in the ever-growing online business environment.
A recently completed Series E funding round has helped Shadowfax bring in $100 million to strengthen its financial status further. This has influenced the growth trajectory of the company since investors have great confidence in its prospects.
Shadowfax has adopted technology as a tool for delivering effective routes, tracking, and data analysis. They improve operations and customer experience in business processes. The growth of online businesses, retail, and food delivery services requires logistics services to support these industries.
Such customers’ needs Shadowfax can easily fulfill these needs, ensuring the company’s future growth. According to the firm’s financial statement, Shadowfax has registered a net loss; however, its adherence to strict financial control and increased revenue shows the firm’s potential for sustainable growth.
Conclusion
While Shadowfax prepares for an IPO, its future is anticipated by investors and market gurus alike. The logistics sector supported by the e-Commerce market developments is a big opportunity; Shadowfax’s IPO might be a game-changer. With a solid base, clear goals and visions, and a desire for innovation, Shadowfax targets to transform last-mile logistics solutions in India.
