Unlike most of the companies which were laying off people, IPO-bound Delhivery claims it not only hired during the peak COVID-19 pandemic, but also ramped up its infrastructure.
“We invest relatively less when the market is booming. We invest more when there is a shock because at that time our competitors are not investing. They are too worried about what they should do. We doubled down and went harder. We built infrastructure, released systems, hired people, increased wages built safety systems, all in that four-five months period. That was our response to the pandemic,” said Sahil Barua, Co-founder of the home-grown logistic firm.
The Softbank-backed firm is looking to raise $800 million via an initial public offering (IPO) at a valuation of around $4 billion.
Founded in 2011 by Barua, Mohit Tandon, Bhavesh Manglani, Kapil Bharati and Suraj Saharan, Delhivery reported a loss of Rs 284 crore during the financial year 2019-2020. It came down from Rs 1,781 crore in the financial year 2018-2019.
The revenue increased by 74 percent to Rs 2,986.4 crore during the financial year 2020.
Speaking to Manoj Kohli - Country Head, Softbank India - at the Global Unicorn Series, organised by Confederation of Indian Industry’s Future Business Group and Young Indians (Yi) in partnership with SoftBank India, Barua said India is a $170-180 billion logistics market and there was scope for many more companies right now.
“We are only just a little over half a billion dollars of revenue. There is space for 15-20 Delhiveries and maybe we will all consolidate in ten years into 4-5 big companies so the challenge is not the market," he said.
"For us the challenge is how do we scope and build infrastructure in time for the future. Because today the horizon of our decision is much longer. It is a three-year build period and a seven-eight year operate period. So we have to plan in decade cycles, and not annual cycles,” he added.
The company is reported to be in talks with several banks, such as Kotak Mahindra Capital Company, Morgan Stanley, Citi, ICICI Securities, JP Morgan, and Bank of America.In 2019, Delhivery raised $415 million in a Series F financing round led by SoftBank, which valued the Gurugram-based company at $1.5 billion. Some existing investors, including Caryle Group and Fosun International, had also participated in the investment round.