Bengaluru/Mumbai: Third-party logistics startup Ecom Express has laid off not less than 500 employees and placed on maintain its plans for an preliminary public providing of its shares because it makes an attempt to trim costs, two folks accustomed to the matter instructed Mint. The corporate’s bills elevated barely to ₹2,921.5 crore in FY24 from ₹2,902.8 crore in FY23.
“Over 500 persons are anticipated to be laid off over the week and the corporate has already closed greater than 3,000 pin codes, 1,000 DCs (supply centres) and 20 main hubs which might be within the technique of closing,” one in all them stated. “The HR has known as people, asking to resign instantly.”
Ecom Express had about 15,600 employees and associates, and delivered items to greater than 27,000 pin codes, as per the corporate’s web site.
The corporate has paused its plans to go public due to unstable market situations, the second of the 2 individuals stated.
On the layoffs, Ecom Express instructed Mint in an announcement that it was “an ongoing course of based mostly on enterprise wants and necessities from time to time”.
Ecom Express faces a stiff problem from rivals akin to Delhivery Ltd and XpressBees, which have their very own fleets and in addition provide different providers, together with business-to-business logistics.
With many of those gamers additionally competing within the business-to-consumer e-commerce logistics enviornment, a value warfare has damaged out, sparking hypothesis of a consolidation, or acquisitions, within the trade.
Moreover, on-line procuring platform Meesho’s in-house logistics arm, Valmo, additionally poses a problem to Ecom Express’ volumes and revenues.
For 2023-24, Ecom Express reported a 2.2% development in income to ₹2,609.2 crore and narrowed its loss to ₹255.8 crore from ₹428.1 crore within the yr earlier than.
In distinction, Delhivery reported final week that its income from operations within the December quarter (the third quarter of 2024-25) grew 8% from a yr earlier to ₹2,378 crore whereas its revenue after tax zoomed 114% year-on-year to ₹25 crore.
Additionally learn | Can Ecom Express’s IPO succeed when Delhivery’s inventory has failed to ship?
IPO on maintain, not shelved
Ecom Express in August filed papers to elevate ₹2,600 crore in an IPO, which was to embrace a contemporary infusion of ₹1,284.5 crore value of shares and an offer-for-sale to permit a few of its outstanding traders akin to Warburg Pincus and British Worldwide Funding deliberate to offload a few of their stake.
The corporate meant to use the proceeds for scaling up its enterprise and increasing its community infrastructure. Ecom Express had additionally stated it might spend money on its logistics and provide chain operations, {hardware} and software program options, information sciences, and product innovation, amongst different issues.
Whereas these plans haven’t materialized, the corporate has not utterly shelved its IPO plans and may pursue a public itemizing later within the yr, the second particular person talked about above stated.
Ecom Express has raised round $324 million throughout 12 rounds from traders, in accordance to information from market intelligence supplier Tracxn.
Based in 2012 by Manju Dhawan, Ok. Satyanarayana, T. A. Krishnan and Sanjeev Saxena, the corporate caters to e-commerce marketplaces, platforms, direct-to-consumer or D2C manufacturers, and small and huge on-line sellers. In 2023, the corporate picked former head of Bharti Airtel Ltd’s enterprise arm, Ajay Chitkara, as its chief government officer.
Additionally learn | Delhivery is regularly discovering its toes amid rising competitors
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