**Ecom Express Faces Layoffs and IPO Delay Amidst Competitive Pressure**
Ecom Express, a third-party logistics startup, has reportedly laid off over 500 employees and suspended its initial public offering (IPO) plans as part of a cost-cutting strategy. The company’s expenses rose slightly to ₹2,921.5 crore in FY24 from ₹2,902.8 crore in FY23. Sources indicate that the layoffs are expected to continue throughout the week, with the company having already closed more than 3,000 pin codes, 1,000 delivery centers, and 20 major hubs. Employees have been contacted by HR to resign immediately.
With approximately 15,600 employees and a delivery network covering over 27,000 pin codes, Ecom Express is facing intense competition from rivals like Delhivery and XpressBees, both of which have their own fleets and offer additional services, including business-to-business logistics. The competitive landscape has led to a price war, raising speculation about potential consolidation or acquisitions within the industry. Furthermore, Meesho’s logistics arm, Valmo, is also impacting Ecom Express’s volumes and revenues.
For the fiscal year 2023-24, Ecom Express reported a 2.2% increase in revenue to ₹2,609.2 crore and reduced its losses to ₹255.8 crore, down from ₹428.1 crore the previous year. In contrast, Delhivery announced an 8% year-on-year growth in revenue for the December quarter, reaching ₹2,378 crore, with a significant profit increase of 114% to ₹25 crore.
In August, Ecom Express had filed for an IPO aiming to raise ₹2,600 crore, which included a fresh issue of ₹1,284.5 crore and an offer-for-sale from major investors like Warburg Pincus and British International Investment. However, the company has now paused these plans due to the current volatile market conditions.