Delhivery Announces Acquisition of Ecom Express for Rs 1,407 Crore

India’s leading logistics and supply chain company, Delhivery, has officially confirmed the acquisition of rival firm Ecom Express Limited for a transaction value not exceeding Rs 1,407 crore. The deal marks a significant consolidation move in India's booming logistics sector.

As per the company’s regulatory filing on Saturday, Delhivery stated:

“The Board has approved the execution of Share Purchase Agreement amongst the Company, the Target Company (Ecom Express) and their shareholders and execution of other necessary documents regarding the aforementioned acquisition (‘Transaction Documents’). Post completion of such acquisition, Ecom will become a subsidiary of the Company.”

What the Leadership Has to Say

Delhivery’s Managing Director and CEO, Sahil Barua, expressed confidence in the integration, noting:

“We believe this acquisition will enable us to service customers of both companies better, through continued bold investments in infrastructure, technology, network and people. The founders and management of Ecom Express have established a high quality network and team, creating a strong foundation to integrate into Delhivery’s operations.”

Echoing this sentiment, K. Satyanarayana, the founder of Ecom Express, highlighted the synergy benefits:

“With this acquisition and its inherent synergies, businesses across India as well as the logistics industry itself will benefit immensely through the combination of two like-minded players.”

Timeline for Completion

Delhivery has outlined that the acquisition will be completed within six months from the date of execution of the Share Purchase Agreement (SPA), unless extended mutually by the parties involved.

Background Tensions Between Delhivery and Ecom Express

Interestingly, this acquisition follows a contentious episode in September 2024, when Delhivery accused Ecom Express of misrepresenting its business metrics in the draft red herring prospectus (DRHP) submitted for listing.

Dispute Over Shipment Volume Calculations

Delhivery explained a key discrepancy in how both companies account for shipment volumes:

“Delhivery counts a shipment, even if it is not delivered to the destination and returned to origin as a single shipment. But, Ecom Express counts it as two shipments as the to and fro transportation are billed separately.”

Based on an industry average of 14-18% returns to origin (RTO), Delhivery estimated that the adjusted shipment number for Ecom Express would be around 450 million, challenging previously reported figures.

Customer Mix and Revenue Concentration Concerns

Delhivery further clarified that comparing the two firms directly would be inaccurate due to variations in their customer mix and shipment weight profiles:

“Per shipment metrics hugely vary depending on shipment profile – weight profile for Delhivery and peer will be significantly different due to different client mix. Peer has top customer concentration of 52% of revenue (vs. 16% for Delhivery) resulting in Delhivery’s average weight per parcel being ~2x of the peer.”

Conclusion: A Bold Step Towards Consolidation and Future Growth

This acquisition not only signals a pivotal moment in India’s logistics landscape but also showcases Delhivery’s bold vision for integrated growth and operational efficiency. By absorbing a key competitor, Delhivery aims to boost its reach, streamline operations, and deliver better service to a wider customer base.

As Ecom Express becomes a subsidiary, the merger is expected to bring complementary synergies, stronger infrastructure, and technological innovations to the forefront—benefiting not just both companies but also the entire logistics ecosystem in India.