Xpressbees’ funding of $40 Bn from Khazana Nasional Berhad Boosts the Firm

Xpressbees, a Pune-based courier service has raised a $40 billion investment from Khazana Nasional Berhad, Sovereign Wealth Fund of Malaysia. According to sources, Avendus Capital, a well-known Enterprise Technology and Services financial adviser, is the transaction’s financial advisor.

The global market for logistics and courier delivery services is constantly growing. The logistics sector is one of the pillars of international commerce, totaling more than 5 trillion euros. In 2022, the logistics market was worth over $8.5 trillion worldwide. The Indian logistics market is also set for expansion. While it was last assessed at roughly $250 billion in 2021, there is likely an increase of $380 billion by 2025. This expected rise in the courier and logistics business is due to the advent of new-age courier and delivery firms and start-ups powered by cutting-edge technology.

Introduction to Xpressbees

Though India has many courier services, the largest of them is Xpressbees. It is the fastest-growing third-party, end-to-end logistics provider in the e-commerce sector of India, based in Pune. It was established in 2015 by Amitav Saha and Supam Maheshwari.  It is known for its strong supply chain management network throughout the nation due to its cutting-edge technology and employs over 30,000 people. Xpressbees has expanded its business lines beyond e-commerce (B2C) to include B2B Express, Warehousing, and cross-border activities. According to the statement, the firm is now present in 5,000 cities, serves over 20,000 pin codes, and distributes over 2 million parcels every day. It has tie-ups with some of the high-quality sets of investors like Blackstone Growth, TPG Growth, ChrysCapital, Alibaba Group, Elevation Capital, Investcorp, Norwest Venture Partners, and Gaja Capital.

Beyond e-commerce (B2C), the company has expanded its business lines to include B2B Express, warehousing, and cross-border activities. The company is currently present in 5,000 cities, services over 20,000 pin codes, and distributes over 2 million packages every day, according to the statement.  The company has previously revealed raising more than $560 million before this investment. Data from Tech in Asia indicates that in February 2022, Xpressbees achieved unicorn status with a worth of US$1.2 billion.

Investment with the Sovereign Wealth Fund of Malaysia

This year Xpressbees has raised a record $40 million investment from the Sovereign Wealth Fund of Malaysia, Khazanah Nasional Berhad. The investment was made through a secondary purchase which is made through an earlier investor of the company.  The financial advisor for this transaction is Avendus Capital, which is well known in Enterprise Technology and Services (ET&S) sector mid-market company Mergers & Acquisitions (M&A), and Private Placement services.

Elevation Capital

It’s noteworthy to note that Elevation Capital has previously withdrawn funds from Expressbees. The company obtained $300 million in primary financing in February 2022, valued at $1.1 billion, from private equity companies Blackstone Growth, TPG Growth, and ChrysCapital. Avendus Future Leaders Fund paid Elevation Capital Rs. 195 crores in August of last year in exchange for a stake in Xpressbees.

Xpressbees’ Competitors

Xpressbees is facing stiff competition from a number of other courier and logistics companies. Fastbeetle, Delhivery, Pickrr, ShipBob, and Ecom Express are some of Xpressbees’ biggest competitors.

Fastbeetle is a relatively new entrant in the courier and logistics market and is trying to disrupt the market with its cutting-edge technology and innovative delivery solutions. Delhivery, on the other hand, is one of the largest logistics companies in India, providing end-to-end supply chain solutions to various industries, including e-commerce. Pickrr is a logistics aggregator that offers logistics services to businesses of all sizes, while ShipBob is a global logistics company that specializes in fulfilling e-commerce orders.

Ecom Express is another major player in the Indian logistics market and provides a range of services, including last-mile delivery and reverse logistics. All these companies are established players in the market and have a strong customer base.

Moreover, Xpressbees’ funding of $40 million from the Khazanah Nasional Berhad will help the company to further expand its business and compete with its rivals. With its focus on innovation and customer-centric approach, Xpressbees is well-positioned to take on its competitors and emerge as a dominant player in the Indian logistics market.

Impact of Xpressbees Funding in the Future

This investment with Khazanah as Xpressbees have established a leading brand but because Xpressbees is still early in its growth story, so there is a huge opportunity for tech-led disruption in logistics. With this deal, the company has continued on its path to become a dominant end-to-end logistics player and look to leverage any strategic opportunities. Khazanah’s disciplined long-term investment approach certainly makes the Malaysian sovereign wealth fund a perfect partner for Xpressbees.

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