CDC Group, the development finance arm of the UK government has invested $36 million for an equity stake in e-commerce logistics firm Ecom Express.
Ecom Express claims that it reaches over 90% of India’s population, with more than 85% of its presence in Tier 2,3 and 4 cities.
The fundraise comes after over two years, when it last raised $30 million from existing investor- private equity firm Warburg Pincus- also a major investor in logistics firm in India and globally.
Based in Delhi, Ecom Express was founded in 2012 by T.A. Krishnan, Manju Dhawan, K. Satyanarayana and Sanjeev Saxena. It is broadly seen as the number two player in the e commerce logistics market behind Delhivery, which is currently valued at over a billion dollars and counts the SoftBank Vision Fund and Tiger Global among its investors.
T.A. Krishnan, Co-founder and Chief Executive Officer of Ecom Express said in a statement, “The infusion of capital will help us further expand our delivery footprint in connecting towns and rural centers across the country."
“Besides expanding reach, the company plans to invest in technology, deploy advanced parcel sortation systems, strengthen network reliability and infrastructure, and finally, make development impact with job creation, environmentally responsible initiatives and gender diversity," he added.
The other significant players in the sector include Alibaba-backed Xpressbees and Flipkart-owned Ekart.
CDC has emerged as a prominent investor in private equity deals in India in recent times, and makes direct investments, as well as in venture capital and private equity funds themselves, as a limited partner (LP).
In an interaction with Mint in July, Nick O’Donohoe, chief executive officer, CDC said that it plans to double its exposure in India to $3.5 billion by 2021.
CDC with 30-35% of its overall portfolio dedicated to India, focuses on seven core sectors, including financial services, infrastructure, healthcare, affordable housing, food and agriculture, consumer and education, for direct investments, he added.