Ecom Express sees 150 employees resign; some senior leaders to quit after CCI approves acquisition by Delhivery

In February, Ecom Express had laid off at least 500 employees after pausing its plans for an initial public offering (IPO). Before that it had about 15,600 employees and associates, and delivered goods to more than 27,000 pin codes, according to the company’s website.

“CCI’s approval is likely to come through in the next 45 days," said one of the people, adding that several employees have resigned voluntarily. “Lot of roles will become redundant after the acquisition so there will be employees opting out, establishing higher cost savings," the second person said.

A spokesperson for Ecom Express said the company was not in a position to comment while it awaited regulatory approval. Delhivery, too, said it had no comment on the matter, while Chitkara did not immediately respond to Mint's queries.

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During Delhivery's earnings call this month, CEO and managing director Sahil Barua said, “The regular attrition in Delhivery's network itself will provide us sufficient room to absorb all qualified staff from Ecom Express in our operations around the country." He added that they would undergo rigorous training during the onboarding process, and that the purchase consideration included about about ₹300 crore in integration costs.

In April, Delhivery announced it had signed a definitive agreement to acquire a controlling stake in Ecom Express Limited for about ₹1,400 crore in cash. Less than a year ago, Ecom Express was valued around ₹7,000 crore. The acquisition is awaiting approval from CCI, after which Ecom Express will become a subsidiary of Delhivery.

'More consolidation ahead'

The logistics giant, which applied for CCI's approval on 19 April, believes there could be more consolidation in the delivery ecosystem, and that the era of "suicidal pricing" in the market has ended. “There were too many players in this market in the previous quarter. Our acquisition of Ecom Express has not changed that dynamic. There are still too many players in the market," Barua said during the earnings call earlier this month. He added that the survival of these companies, which are still unprofitable, depends on how much capital they have left.

“I think what this deal has done is signal that if you are a loss-making network in express parcel with no path to profitability, consolidation or exit is an inevitable outcome," Barua said. He anticipated that with this acquisition and consolidation, there would be additional growth in Delhivery’s parcel volumes.

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For context, Ecom and Delhivery have nearly 100% overlap of customers, which means all customers that work with Ecom Express are already deeply integrated and familiar with Delhivery's operational and billing processes and that collections and reconciliation are also similar.

Comparing the scale of the two companies, Barua said during the earnings call that Ecom Express's express parcel volumes were about 40% of Delhivery's, and that it network tonnage was less than 20% of Delhivery's.

Delhivery said it expects to retain a limited portion of Ecom Express's network. It will retain facilities in locations where either its own capacity is constrained, or where it is feasible to repurpose an existing transportation facility into a Delhivery fulfillment centre or service centre. It also clarified that no additional technology would be required to integrate these facilities into Delhivery's network.

From IPO dreams to acquisition

Ecom Express was previously slated to go public, and filed draft papers last August to raise ₹2,600 crore in an IPO. This included a fresh infusion of shares worth ₹1,284.5 crore and an offer for sale that would allow some of its prominent investors such as Warburg Pincus and British International Investment to offload some of their shares.

However, it paused its IPO plans earlier this year and laid off nearly 500 employees to cut costs. Still, it faced a stiff challenge from rivals such as Delhivery and XpressBees, which have their own fleets and offer other services, including business-to-business logistics. Its downfall was also due in part to its heavy reliance (more than 50%) on Meesho, which built its own in-house logistics unit, Valmo, making it difficult to replace the lost business.

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As many of these companies also compete in business-to-consumer e-commerce logistics, a price war has broken out, sparking speculation of further consolidation in the industry.

For FY24, Ecom Express reported 2.2% growth in revenue to ₹2,609.2 crore and narrowed its loss to ₹255.8 crore from ₹428.1 crore in the year before. In the first nine months of FY25 it made an overall loss of ₹184 crore and an adjusted-Ebitda loss of ₹104 crore, Barua said in the earnings call.

Delhivery turned profitable for the first time in FY25, posting a net profit of ₹72.6 crore as revenue rose 6% year-on-year.