Moglix eyes India domicile shift, IPO launch within two years

Bengaluru: Alpha Wave Global-backed Moglix, a business-to-business (B2B) e-commerce unicorn for manufacturing goods, is contemplating relocating its domicile to India, and launching an initial public offering (IPO) within two years, founder and chief executive officer Rahul Garg said in an interview.

"I think we will continue to evaluate 2026-27 as the sweet spot for going public," Garg said, adding that Moglix will become "publicly ready" within 12 months.

The development comes amid a growing trend among several startups with reasonable scale and a clear path to profitability, such as Razorpay, Eruditus, and Groww, in favouring India as a listing destination. 

This shift is propelled by improved accessibility to domestic capital markets and ease-of-doing-business, despite significant tax implications associated with such transitions.

For startups, a domicile change might involve creating a company in India, which would acquire shares of the foreign entity, incurring capital gains taxes. Alternatively, some may opt to acquire a bankrupt firm in India and execute a reverse merger with the foreign entity to reduce the capital gains outflow.

When asked about Moglix's potential tax implications in transitioning to India, Garg said there is no definitive information available as the process is still underway. Besides, he said, it is premature to comment on pursuing the acquisition route for the transition.

While Moglix is exploring opportunities in other markets as well, India appears to be the more favorable destination, he added. "India is a very attractive place to list as the company has the strongest brand presence in the country."

According to Garg, the Indian public market has become substantially larger compared to what it was 10 years ago, and there is sufficient investor capital available.

Founded in 2015, Moglix offers procurement, packaging, supply chain financing and integrated software services solutions. In addition to Alpha Wave, which spearheaded its unicorn round in 2021, the company counts Tiger Global, Jungle Ventures, Ward Ferry, IFC and Accel among its investors.

Moglix operates in India, the US, Europe and the UK, serving more than 500,000 small-and-medium enterprises (SMEs) and 1,000-plus large manufacturers. With a network of over 16,000 suppliers and 40 warehouses, as well as associated logistics infrastructure, the company intends to strengthen its presence in all current markets.

Moglix,with 95% of its total revenues originating from India, seeks to deepen its presence in international markets, besides exploring entry into 2-3 new areas, Garg said. "I think, over the next 2-3 years, we will be hovering around 10-15% of our revenue from international markets."

While Moglix has allocated $100 million for acquisitions, and completed four deals in the past three years, it is also seeking opportunities to expand its omni-channel distribution, besides targeting areas where entrepreneurs have developed small private labels but are struggling to scale up, Garg said.

In FY23, Moglix's operating revenues grew 83% to ₹4,595 crore from a year earlier. However, its losses widened by 12% to ₹193 crore. The company expects to turn profitable by the first quarter of FY25.