Delhivery Bets on Scale with ₹1,407 Cr Ecom Express Buyout

Delhivery is acquiring a 99.4% stake in Ecom Express. The cash consideration for the acquisition is INR 1,407 Cr ($164.5 Mn). This represents a significant drop in Ecom Express’s valuation, which was last reported at around INR 7,000 Cr in June 2024. This is a nearly 80% cut in its valuation from its peak.

The acquisition is characterised as a “fire sale” and a “distress sale” for Ecom Express, indicating potential financial pressures or strategic shifts for the company.

Ecom Express was earlier pursuing an Initial Public Offering (IPO) and had filed its Draft Red Herring Prospectus (DRHP) for INR 2,600 Cr in August of the previous year and had received SEBI approval in December 2024.

But the acquisition announcement came “out of the blue”, suggesting a sudden change in Ecom Express’s strategic direction. Therefore, the company did not file its Red Herring Prospectus (RHP) even after receiving SEBI approval, making its public listing unlikely.

Delhivery sees this acquisition as a scale play—aimed at boosting efficiency and strengthening its value proposition. With greater scale, the company expects to invest better in service quality—through network expansion, automation, EVs, tech upgrades, and R&D in areas like robotics and drones.

The acquisition is seen as a way for Delhivery to expand its market share and improve its competitive position in the competitive logistics segment. The company expects strong synergies from the merger—benefiting not just its business, but the wider logistics ecosystem.

Delhivery’s CEO, Sahil Barua, says the deal will help serve customers of both firms better, backed by deeper investments in infrastructure, tech, and talent.

Sahil Barua, MD and CEO of Delhivery: “We believe this acquisition will enable us to service customers of both companies better, through continued bold investments in infrastructure, technology, network and people. The founders and management of Ecom Express have established a high-quality network and team, creating a strong foundation to integrate into Delhivery’s operations.”

Ecom Express founder K. Satyanarayana sees Delhivery as the ideal shareholder for the company’s next phase, citing its scale advantage. He believes the merger of two like-minded players will create significant value—not just for the companies, but for the logistics industry as a whole.

K Satyanarayana, founder of Ecom Express: “Delhivery is among India’s leading fully integrated logistics service providers with significant scale advantages and will be the ideal shareholder for Ecom Express’ next phase of growth. With this acquisition and its inherent synergies, businesses across India as well as the logistics industry itself will benefit immensely through the combination of two like-minded players.”

Ecom Express reported a modest 2.15% rise in operating revenue—₹2,609 Cr in FY24, up from ₹2,553.9 Cr in FY23. Its net loss dropped sharply by 67%, from ₹428.1 Cr in FY23 to ₹255.8 Cr in FY24.

Notably, over half of its FY24 revenue—51.15%—came from a single customer group, reportedly Meesho. That dependency likely took a hit after Meesho launched its in-house logistics arm, Valmo, in Feb 2024. The company also faced intense competition in a crowded logistics space.

Adding to the pressure, Delhivery had earlier accused Ecom Express of misreporting shipment volumes in its DRHP. It claimed the reported 514.41 Mn shipments in FY24 were inflated by double-counting RTOs, with the real figure closer to 450 Mn.

Delhivery is scaling up its quick commerce play, offering two-hour deliveries in Bengaluru, Hyderabad, and Chennai. It’s targeting ₹80–100 Cr in revenue from this vertical in FY25.

On the drone front, Delhivery got the green light for its drone subsidiary in July 2024, but Ecom Express had already piloted drone deliveries in Delhi NCR a month earlier. The acquisition could fast-track Delhivery’s push into drone logistics.

Warburg Pincus, Partners Group, and British International Investment will fully exit Ecom Express through this deal. The acquisition is pending CCI approval and is expected to close within the next six months.

It’s being called one of the biggest consolidation moves in the sector. An investor noted the deal could bring “sanity to the pricing market” and set the stage for long-term profitability for the merged entity.