Companies
Porter looks to raise $100 million from private equity firms
Summary
- The company has raised a total capital of $150 million from investors like Tiger Global, Peak XV Partners, the Mahindra Group and Lightrock, among others. It was last valued at $500 million in 2021 when it raised an external round by investors led by Tiger Global and Vitruvian Partners.
Private equity companies are looking to invest $100 million in new-age intra-city logistics services provider Porter, in a deal that will value the decade-old startup at $1.1-$1.2 billion, two people with knowledge of the development said.
The new funding round will be a mix of primary and secondary share sale, they said on the condition of anonymity.
The Benagaluru-based company has got terms sheets from investors including Kedaara Capital, Multiples and Peak XV, the first person cited earlier said, adding that Porter has been able to bring down its burn rate while growing its revenues, and is therefore demanding a premium to its last round valuations.
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“The ask was as high as $1.3 billion - $1.4 billion," the second person said. However, the secondary portion where some of the early investors in the company are looking to sell stake will be valued at a discount, with the blended value being over a billion dollars, these people said.
Earlier this year, Porter entered the unicorn club after completing an internal round, where individuals bought shares from the employee stock ownership plan (ESOP) pool at a valuation of $1 billion, Mint reported last month. Generally, as a rule of thumb, a revision in valuation is set by an incoming investor and not by existing ones.
Capital raised
The company has raised a total capital of $150 million from investors like Tiger Global, Peak XV Partners, the Mahindra Group and Lightrock, among others. It was last valued at $500 million in 2021 when it raised an external round by investors led by Tiger Global and Vitruvian Partners.
Founded in 2014 by Uttam Digga, Pranav Goel, and Vikas Choudhary, Porter offers a logistics platform to help businesses with their last-mile delivery operations.
A spokesperson for Porter declined to comment. Peak XV's spokesperson also declined to comment, while spokespersons of Kedaara and Multiples did not respond to queries.
According to a latest Grant Thornton Bharat report, the logistics sector in India is growing at an annual rate of 10–12%, contributing 14.4% to India's GDP and employing more than 20 million people. The intra-city logistics market in India is expected to grow at a compound annual growth rate (CAGR) of more than 5% in the coming years. Some of the major companies in the Indian intra-city logistics market include FM Logistics India, Porter, Lets Transport, cityXfer, and Shadowfax.
Also read | Logistics startup Porter eyes more small cities for growth
Porter is looking to double its domestic geographical presence in the next 3-4 years, even as it seeks to expand its international operations beyond Dubai, a market it entered last year, the founder told Mint in an interview last month. The company, which is currently present in about 22 cities, including 7-8 metro cities, is looking to expand to nearly 40 cities in the coming years, Digga, co-founder and CEO of Porter, had told Mint.
The company saw a 56% increase in revenue to more than ₹2,700 crore in FY24, with its losses shrinking 45% to ₹96 crore. Around 10-15% of Porter’s revenue comes from newer initiatives, newer geographies and 85% from mature businesses and geographies, according to Digga. The expansion to newer cities would lend tier-2 markets 10% more revenue share.
