According to market sources, the potential listing could bring the value of Snapdeal to around $1.5-1.7 billion.
E-commerce platform Snapdeal has filed preliminary documents with markets regulator SEBI to raise funds through initial public offering (IPO), joining the league of internet-led businesses looking to list on domestic stock exchanges. went.
According to the draft Red Herring Prospectus (DRHP), the public issue comprises an offer for sale (OFS) of equity shares of ₹ 1,250 crore and 3.07 crore equity shares.
According to market sources, the potential listing could bring the value of Snapdeal to around $1.5-1.7 billion.
Snapdeal founders Kunal Bahl and Rohit Bansal are not selling any stake in the IPO.
Those who sold shares in the OFS include Starfish I Pte., Wonderful Stars, Sequoia Capital, Kenneth Stuart Glass, Myriad Opportunities Master Fund, Ontario Teachers Pension Plan Board, Laurent Amouil and Milestone Trusteeship Services.
The proceeds from the fresh issue will be used to finance organic growth initiatives, expand logistics capabilities and enhance the company’s technical infrastructure. Axis Capital, BofA Securities India, CLSA India and JM Financial are the book running lead managers of the issue.
The overwhelming response to Zomato’s IPO and profitable listing in July has prompted many internet-based businesses to go down this route.
Since then several internet based businesses, including Nykaa, Paytm and PolicyBazaar, have also got listed on the exchanges. However, one of the most awaited IPOs, Paytm saw weak listings.
Snapdeal is an e-commerce company, and focuses exclusively on the value segment, with more than 90% of its products sold on the platform priced below ₹1,000 and over 80% of its users living outside metro cities .
Once a leading player in the Indian e-commerce space, Snapdeal has seen its fortunes fall amid stiff competition from rivals Amazon and Flipkart.
In 2017, Snapdeal walked away from a possible merger deal with Flipkart and instead adopted the “Snapdeal 2.0” strategy to become “financially self-sufficient”.
The company, which is backed by SoftBank, BlackRock Inc., Temasek Holdings Pte. and eBay Inc., is investing in video, vernacular and other strategic projects aimed at growing the online market among new users, particularly in Tier II cities. To come from and beyond.
The company’s power brands, Unimov logistics platform, multilingual user support and its discovery-based shopping approach that replicates the offline journey of buyers are some of the efficiencies it has built as part of its India-centric strategy.
As part of its expansion plans, Snapdeal plans to expand into omni-channel distribution through partner-operated offline stores. Offline channels accounted for 92% of all sales in the Value Lifestyle retail market by FY21.
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