E-commerce logistics firm Delhi may postpone its initial public offering (IPO) plan by a few weeks. Three sources from this matter have given this information to Moneycontrol. He said that the company has taken this decision in view of the huge volatility in the market. However, he also told that the company still wants to bring its IPO in this financial year i.e. before 31 March 2022.
A source said, “Merchant bankers have advised the company to wait for a month or two considering the prevailing market conditions. They also want to avoid a clash with LIC’s IPO, which will be held in the first week of March. is expected to be launched in
Life Insurance Corporation of India (LIC) is preparing to bring the country’s big IPO, through which the Government of India wants to raise up to Rs 1 lakh crore by selling its stake. The issue will be nearly 5 times bigger than Paytm’s Rs 18,300 crore IPO, which is the country’s largest IPO ever.
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A second source said, “The market is currently witnessing a huge beating of the stocks of loss-making new-age tech and internet companies. Hence, they would not like to repeat Paytm’s poor listing situation.” Till the time of writing this report, Delhivery had not responded to queries sent by Moneycontrol.
Delhivery had filed a document on November 2, 2021, seeking approval from market regulator SEBI to bring the IPO. Through the IPO, the company wants to raise around $1 billion (Rs 7,460 crore) at a valuation of around $6 billion. A major part of this IPO will be offer-for-sale, through which the company will give an opportunity to many of its investors to exit the company by selling stake at an attractive valuation. Such attractive exits, then, are seen as a measure of success of the country’s startup and technology sector.
Delhivery’s IPO was given green signal by SEBI on 18 January. Companies usually have at least a month’s time to launch an IPO after getting approval from the market regulator. However, Moneycontrol has got information that Delhivery wants to bring its IPO in this financial year and after LIC’s IPO, it can launch it in the second or third week of March. The company had earlier planned to list in the first week of February.
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There will be an offer-for-sale (OFS) from investors of about Rs 2,460 crore in Delhivery’s IPO. In this, private equity firms Carlyle and SoftBank will sell their partial stake. Carlyle first invested in Delhivery in November 2017. Carlyle will sell shares worth Rs 920 crore in this IPO offer for sale. Apart from this, Fosun Group, owned by China Momentum Fund, will also sell shares worth Rs 400 crore in this IPO, while SoftBank will sell shares worth Rs 750 crore and Times Internet Rs 330 crore.
The proceeds from the IPO will be used for the organic and inorganic growth of the company. Rs 1,250 crore from this IPO will be used for acquisitions and other business expansion plans. Kotak Mahindra Capital, Morgan Stanley India, BofA Securities India, Citigroup Global Markets are the Book Running Lead Managers of this IPO.
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