Flipkart-backed logistics startup BlackBuck eyes $300 million IPO

BlackBuck, a logistics startup, is setting the stage for a public debut with plans to launch an Initial Public Offering (IPO) aimed at raising $300 million.

The company, established in 2015 and officially known as Zinka Logistic Solutions Pvt Ltd, has initiated the process by appointing merchant bankers and lawyers to craft its draft red herring prospectus (DRHP). With intentions to incorporate the full financial figures of FY24, BlackBuck targets the second half of FY25 for its market entry.

IPO details

The proposed IPO is structured to include both a fresh issue of shares to attract capital and a secondary sale of shares by existing investors. This dual approach aims to bolster the company's service offerings while providing an exit or partial exit opportunity for current stakeholders.

The exact scale of the offering and the proportion of the secondary sale are still under discussion, as per the media reports.

Utilization of proceeds

Funds raised from the IPO are earmarked for significant expansion. BlackBuck plans to leverage the capital to enhance its services business, which includes GPS tracking devices, FASTags, and fuel cards, and to further develop its core freight business.

The strategic investment is expected to solidify BlackBuck's position in the logistics sector and accelerate its growth trajectory.

How well BlackBuck is performing financially?

Despite becoming a unicorn in 2021 with a valuation surpassing $1 billion, BlackBuck's financial performance in FY23 showed a decline in consolidated revenue by 15% to Rs 704.18 crore from Rs 832.57 crore the previous year. 

The company also reported a slight increase in losses, amounting to Rs 290.47 crore in FY23 compared to Rs 284.55 crore in FY22. These figures reflect the challenging environment for tech startups, influenced by global economic pressures and a tightening of funding avenues.

BlackBuck is backed by Flipkart, Tiger Global, Accel, and Sequoia, among others.