An important minority stake has been picked up by Carlyle Asia Partners investment fund IV in ecommerce logistics business Delhivery by leading a $100 million, or about Rs 655 crore, financing round. Existing investor Tiger Global additionally participated in the round that values the Gurgaon about Rs 3, 920 crore., or based business at over $600 million This can be world’s second-largest PE fund Carlyle’s first large logistics stake in India in the ecommerce space. It’s also among the biggest PE investment in this space, after Warburg Pincus has agreed to commit $133 million in Ecom Express in July 2015.
Managing director at Carlyle Group in India, Neeraj Bharadwaj, said the fund made a decision to put money into Delhivery based on data sciences, and its scale, technology and analytics capabilities. In India, 70% of the ecommerce marketplace is electronic equipment and cellular. Groups like clothing, home decor, supermarket, furniture type a bigger share in a mature marketplace, in case you look at marketplaces world-wide. We believe these groups will grow in India, hastening the importance of third party logistics players, Bharadwaj said. While groups like market and furniture will see the development of perpendicular players, the flat players will continue to be the greatest players, he explained.
Delhivery, which started in 2011 as hyperlocal food delivery startup in Gurgaon, shortly became an ecommerce logistics business piggybacking on the on-line retail boom. It now services 8, 500 PIN codes. And 600 cities works with businesses like Paytm and Flipkart and has a network of embodiment 12 centers. For the year ended March 2016, Delhivery documented losses of Rs 317 crore, up from Rs 71 crore in the preceding year, based on data research platform Tofler.
Nevertheless, its sales, also, more than double the Rs 495 crore from Rs 228 crore through the same period. Delhivery had formerly raised $85 million in May 2015 from Times Internet Ltd, Nexus Venture Partners, Multiples Alternative Asset Management and Tiger Global. Multiples Alternative Asset Management afterwards sold part of its own stake to Tiger Global. E Tailing penetration and increase depends on the development of logistics ecosystem. As each will control specific states to serve the marketplace the 3rd party logistics players will continue to flourish. If E Tailing has to grow to the Tier 2 and below cities, India is too large to be protected with just one player. Investments in this space will help in improving the warehousing capacity and ability to support sellers directly, newer and alternative ways of last mile fulfilment as well as sophistication of technologies, said Sreedhar Prasad, associate Start & E Commerce ups, KPMG India.