Bengaluru-based Udaan raises $114 million from existing investors ahead of planned IPO

Bengaluru-based B2B e-commerce platform Udaan has raised $114 million or over Rs 970 crore in a fresh equity funding round from existing investors M&G Investments and Lightspeed Venture Partners, bringing its total capital raised to nearly $2 billion ahead of a planned public listing in 2026. 

The unicorn startup did not disclose its current valuation in the latest tranche of its Series G round, although media reports indicated that it remains unchanged at approximately $1.8 billion. The funding announcement follows a $75 million infusion from the same investors earlier this year.

Founded in 2016, Udaan connects manufacturers and wholesalers with small retailers across India, operating across categories like FMCG, electronics, lifestyle, pharmaceuticals, and agricultural staples. The company said it will deploy the latest funds to expand its presence in high-volume verticals, including FMCG and the HoReCa (hotel, restaurant and catering) segment—areas where it sees both scale and margin upside.

Udaan also said it will double down on private-label offerings, particularly in the staples category. This push is aligned with the company’s broader attempt to grow contribution margins while maintaining top-line momentum. It reported over 60% year-on-year growth in contribution margin in calendar year 2024, with a 300-basis-point improvement. That trend appears to be holding, with an additional 100 bps improvement recorded so far in 2025.

Vaibhav Gupta, co-founder and CEO, said in a statement that Udaan has cut its EBITDA burn by 40%  annually over the last three years and aims to reach group-level EBITDA profitability in the next 18 months.

"We have transformed the business by building cost as a capability and a competitive advantage," he said. In FY24, Udaan’s revenue from operations rose 1.7% to Rs 5,706 crore, while its net loss narrowed nearly 19% to Rs 1,674 crore. The company said it reduced fixed costs by 20% last year and by another 20% so far in 2025.

The company also continues to grow its fintech arm, udaanCapital, which provides working capital loans and credit products to small merchants and manufacturers. Udaan received approval in January from the National Company Law Tribunal to consolidate its various business entities under Hiveloop E-Commerce, a step that simplifies its corporate structure in the run-up to an IPO.

India’s B2B e-commerce sector is expected to grow to over $125 billion in gross merchandise value by 2027, according to estimates from Avendus Capital.