UK’s impact investor CDC bets on India’s sustainable businesses; backs e-commerce logistics company

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Updated: December 10, 2019 4:39:39 PM

Ecom Express competes with Delhivery, Shadowfax, Xpressbees in the $1.35 billion e-commerce logistics market that is expected to grow at around 36 per cent CAGR.

Ecom Express delivers to over 25,000 pin codes across 29 states in India.

Warburg Pincus-backed e-commerce logistics service provider Ecom Express has raised $36 million from the UK’s development finance institution and impact investor CDC Group, the company announced on Tuesday. Incorporated in 2012, Ecom Express delivers to over 25,000 pin codes across 29 states in India. The company had last raised $30 million from Warburg Pincus. The amount will be spent on network expansion apart from enhancing its number of employees from 32,000 to 47,000 with a focus on increasing in women workforce in one-two years. “In Ecom Express, we have a partner company that recognises the vital importance of creating a genuinely sustainable and gender-inclusive business,” said Srini Nagarajan, Managing Director and Head of Asia CDC. Among its other startup investments are Axis Rooms, BookMyForex, Chumbak, Delhivery, Milk Mantra, BigBasket etc.

Ecom Express competes with Delhivery, Shadowfax, Xpressbees in the $1.35 billion e-commerce logistics market. The market, according to a KPMG 2018 report is expected to grow at around 36 per cent CAGR for the following five years. The growth is driven by the rise of online retail in India that is worth $19.5 billion — among the key factors for which is the number of users from tier-II and beyond coming online to shop and transact. This seems to fit in the Ecom Express claimed to reach more than 90 per cent of the population — over 85 per cent of which are present in tier-II cities and hinterland.

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The company also plans to invest in “technology, deploy advanced parcel sortation systems, strengthen network reliability and infrastructure,” said T.A. Krishnan, Co-founder and Chief Executive Officer of Ecom Express. The company, as reported by Financial Express earlier, saw 78 per cent rise in its operational revenue to Rs 1,005.85 crore in FY19, as per its RoC filings sourced from business intelligence platform Tofler. The losses for the company also went down by 75.39 per cent to Rs 129.59 crore from Rs 526.69 crore in FY18. However, its expenses went up from Rs 1,105.44 crore in FY18 to Rs 1,148.05 crore in FY19.

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