Shadowfax Technologies IPO day 3 Highlights: Issue closes with 2.72x bids — GMP falls to nil; all eyes on allotment

Shadowfax Technologies IPO allotment is slated to be finalised on Friday, January 23. The offer closed today with a tepid 2.72x demand.

1. Funding of capital expenditure requirements of the company in relation to network infrastructure – ₹423.43 crore
2. Funding of lease payments for new first-mile centres, last-mile centres and sort centres – ₹138.64 crore
3. Funding of branding, marketing and communication costs – ₹88.57 crore
4. Unidentified inorganic acquisitions and general corporate purposes

Shadowfax Technologies IPO was subscribed 2.72 times on the final day of the bidding process on Thursday. The offer was booed 3.81 times in the QIB space, 2.31 times in the retail quota and 2.07 times in the employee segment. The NII portion did not sail through and was booked 84%, according to BSE data.

KC Securities has Shadowfax IPO is suitable for high-risk, long-term investors as industry outlook looks positive. The company is well-positioned to benefit from the rapid expansion of India’s e-commerce and last-mile logistics market, with recent

revenue and order volumes growing strongly. However, while revenue momentum and profitability have both been improving (including turning a small profit in FY25 and a notable net profit increase in the first half of FY26), overall margins remain modest and earnings visibility is still developing.

At around a 2.8× Price-to-Sales multiple, the IPO valuation is relatively high compared with peers such as Delhivery, making it a pricier play in the logistics space as small player have lot of growth space in industry hence long term can be

promising.

The company has incurred losses of ₹11.88 crore in FY2024 and ₹142.64 crore in FY2023 and has experienced negative cash flows in certain periods, which may continue due to rising expenses.

By 4:18 PM on the third day of bidding, the public issue was subscribed to 2.71 times after the end of bidding on day 2. The retail portion of the book build issue had been subscribed to 2.25 times, the NII segment had been filled 0.83 times, whereas the QIB segment had been subscribed to 3.81 times.

On the economic front, STL is structurally positioned to benefit from India’s underpenetrated yet fast-growing e-commerce, quick commerce, and on-demand hyperlocal markets, supported by favourable digital adoption trends, rising convenience-led consumption, and increasing demand for faster, value-added logistics services. On the financial front, the company has delivered a revenue CAGR of 33% between FY23–25.

On the economic front, STL is structurally positioned to benefit from India’s underpenetrated yet fast-growing e-commerce, quick commerce, and on-demand hyperlocal markets, supported by favourable digital adoption trends, rising convenience-led consumption, and increasing demand for faster, value-added logistics services. On the financial front, the company has delivered a revenue CAGR of 33% between FY23–25.

— BP Equities

Profitability has seen a substantial turnaround over the same period, with EBITDA improving from a loss of Rs. 113 crores in FY23 to a profit of Rs. 64 crores, while PAT moved from a loss of Rs. 143 crores to a profit of Rs. 21 crores. Going forward, we expect further improvement in margins and return ratios, driven by a favourable shift in service mix toward higher-yield segments such as value-added express services, same-day delivery, quick commerce, and D2C/SME-led volumes, alongside operating leverage and continued technology-led cost efficiencies.

— VP Equities

At the upper end of the price band of Rs. 124 per share, the company is trading at a P/E of 155.0x based on its FY26 annualised earnings. Supported by strong industry tailwinds and clear profitability drivers, STL appears well-positioned to benefit from the evolving digital commerce landscape. We thus recommend a "SUBSCRIBE" rating for the issue from a medium- to long-term perspective.

— BP Equities

The company has incurred losses of ₹11.88 crore in FY2024 and ₹142.64 crore in FY2023 and has experienced negative cash flows in certain periods, which may continue due to rising expenses.

The company is well-positioned to benefit from the rapid expansion of India’s e-commerce and last-mile logistics markets, with recent revenue and order volumes growing strongly. However, while revenue momentum and profitability have both been improving (including turning a small profit in FY25 and a notable net profit increase in the first half of FY26), overall margins remain modest and earnings visibility is still developing.

— KC Securities

At around a 2.8× Price-to-Sales multiple, the IPO valuation is relatively high compared with peers such as Delhivery, making it a pricier play in the logistics space. As a small player, it has significant growth potential in the industry, and the long term can be promising. The issue is suitable for high-risk, long-term investors, as the industry outlook is positive.

— KC Securities

The company is the fastest-growing 3PL company of scale in India as of March 31, 2025, expanding its e-commerce shipment market share from ~8% in FY2022 to ~23% in the six months ended September 30, 2025. Within the express service line, they are market leaders in reverse pickup shipments, in terms of order volume for FY2025 and the six months ended September 30, 2025. They are also a market leader in 3PL quick commerce (or “Q-Commerce”) solutions and same-day delivery based on order volume for FY2025 and the three months ended June 30, 2025. Their platform processed 43.64 crore orders during FY2025, achieving a CAGR of 29.77% from FY2023. During the six months ended September 30, 2025, they processed 29.45 crore orders, which represents a CAGR of 50.11% from the six months ended September 30, 2024. In FY2025, they generated revenue from operations of ₹2,485.13 crore, with an Adjusted EBITDA margin of 1.96%. For the six months ended September 30, 2025.

By 2:03 PM on the third day of bidding, the public issue was subscribed to 1.41 times after the end of bidding on day 2. The retail portion of the book build issue had been subscribed to 2.00 times, the NII segment had been filled 0.51 times, whereas the QIB segment had been subscribed to 1.66 times.

Backed by Flipkart, Shadowfax is a critical backbone for India’s digital economy. Its proprietary AI (SF Maps & Frodo) provides a technological edge in route optimisation and address intelligence that serves as a high barrier to entry.

Shadowfax grew its share of India’s 3PL e-commerce shipments from 8% in FY22 to 23% in 2025, effectively capturing volume from larger established rivals.

The subscription trend indicates strong retail enthusiasm but restrained institutional appetite, likely due to concerns around rich valuation, thin margins, and client concentration, even as the company offers long-term exposure to India’s growing last-mile and quick-commerce logistics space.

— Gaurav Garg, Research Analyst at Lemonn Markets Desk

Shadowfax Technologies’ IPO remained undersubscribed at 0.70x overall as of 12:09 PM on Day 3 (January 22, 2026), despite strong retail investor interest. The retail portion was subscribed 1.98x, while QIB (excluding anchor) participation stayed muted at 0.40x and NII at 0.43x, reflecting cautious sentiment among institutional and high-net-worth investors.

— Gaurav Garg, Research Analyst at Lemonn Markets Desk

The company turned profitable in FY25 and saw net profit surge 114% to ₹21 crore in H1 FY26. This shift was driven by operating leverage, not cost-cutting, as revenue grew 68% in the same period.

By crowdsourcing its fleet of 3.5 million+ registered partners and leasing facilities, the company maintains low fixed costs. This led to a sector-leading Capital Turnover Ratio of 3.96x in FY25.

By 12:09 PM on the third day of bidding, the public issue was subscribed to 0.66 times after the end of bidding on day 2. The retail portion of the book build issue had been subscribed to 1.88 times, the NII segment had been filled 0.41 times, whereas the QIB segment had been subscribed to 0.38 times.

Shadowfax is the only 3PL player in India combining e-commerce express (multi-day) and hyperlocal (30-min) delivery at scale. It leads the market in reverse logistics (returns) and 3PL quick commerce volumes.

Backed by Flipkart, Shadowfax is a critical backbone for India’s digital economy. Its proprietary AI (SF Maps & Frodo) provides a

technological edge in route optimization and address intelligence that serves as a high barrier to entry.

Heavy reliance on third-party franchisees for a portion of our last-mile deliveries.

The logistics solutions company has declared the Shadowfax Technologies IPO price band at ₹118 to ₹124 per equity share.

By 10:03 AM on the third day of bidding, the public issue was subscribed to 0.62 times after the end of bidding on day 2. The retail portion of the book build issue had been subscribed to 1.72 times, the NII segment had been filled 0.34 times, whereas the QIB segment had been subscribed to 0.38 times.

Investors have just one day to apply for the book build issue, as bidding ends this evening at 5:00 PM.

Operating on an asset-light model with a crowdsourced network of over 3 million delivery partners, it powers last-mile and hyperlocal deliveries for major players like Flipkart, Meesho, Swiggy, and Zomato. Covering over 15,000 pin codes across 2,500 cities, the company leverages proprietary AI to optimise supply chains, solidifying its position as a critical backbone for Indian e-commerce and quick commerce.

Shadowfax Technologies Limited has scaled its operations and achieved profitability on the back of a technology-driven, asset-light logistics model, with improving margins fueled by a dominant presence in the high-frequency hyperlocal and quick commerce segments

The ₹1,907.27 Crore IPO is a mix of a ₹1,000 Crore Fresh Issue and a ₹907.27 Crore Offer for Sale (OFS). Approximately ₹423 Crore of the fresh proceeds will be utilised for strengthening network infrastructure, while ₹138.64 Crore will fund lease payments for new sortation and delivery centers. Additional capital is allocated for branding and marketing to expand their crowdsourced partner network and for inorganic acquisitions.

— Anshul Jain, Head of Research at Lakshmishree

Despite intense competition from incumbents and high client concentration, Shadowfax’s proprietary AI-led routing and its leading 23% market share in express parcels allow it to capitalise on India's booming digital economy. We recommend a ‘SUBSCRIBE’ rating for long-term investors.

— Anshul Jain, Head of Research at Lakshmishree