Shadowfax IPO DRHP: Flipkart-Backed Logistics Firm Eyes ₹8,500 Crore Valuation; Profit Rebound, Investor Exits, and Key Risks Explained

Mumbai | November 3 – Logistics platform Shadowfax Technologies Ltd, backed by Flipkart, Eight Roads Ventures, and Mirae Asset, has filed an updated draft red herring prospectus (UDRHP-I) with SEBI for an initial public offering (IPO) worth ₹2,000 crore.

The Bengaluru-based logistics tech firm, among India’s largest third-party delivery networks, plans to expand its reach, reduce liabilities, and offer partial exits to early investors. The issue will be evenly split between a ₹1,000 crore fresh issue and a ₹1,000 crore offer for sale (OFS).
Shadowfax is reportedly seeking a valuation near ₹8,500 crore, placing it among India’s most valuable logistics start-ups.

Investor Exits and Stake Sales

The OFS will enable several marquee backers to book partial profits:

• Flipkart Internet – ₹237 crore
• Eight Roads Ventures – ₹197 crore
• IFC – ₹169 crore
• NewQuest Asia – ₹166 crore
• Mirae Asset–Naver Asia Growth Fund – ₹153 crore
• Qualcomm Ventures – ₹52 crore

Founders Abhishek Bansal and Vaibhav Khandelwal, who jointly hold 19.13% (Bansal 10.76%, Khandelwal 8.37%), are not selling their stakes, signalling confidence in the company’s long-term prospects.

ICICI Securities, Morgan Stanley India, and JM Financial are the book-running lead managers. The company may also raise ₹200 crore through a pre-IPO placement, which could reduce the fresh issue size.

Utilisation of Proceeds

Funds raised from the fresh issue will support expansion and brand growth:

• ₹423 crore — network and capacity expansion
• ₹139 crore — lease payments for facilities
• ₹89 crore — marketing and brand-building initiatives

The balance will go toward acquisitions and general corporate purposes.
Shadowfax currently operates 4,299 touchpoints across 14,758 pin codes, spanning 3.5 million sq. ft. of logistics space, with expansion plans targeting Tier-2 and Tier-3 markets.

Financial Performance:

Shadowfax’s financials indicate a sharp turnaround over the past two years, moving from losses to profitability.

In H1 FY26, the company reported ₹1,805.6 crore in revenue and a profit of ₹21 crore, nearly double the previous year’s first half — highlighting a strong operational rebound.

CEO Abhishek Bansal and Director Vaibhav Khandelwal each earned ₹1.05 crore in FY25.
New executive directors Gaurav Jaithlia and Praharsh Chandra, who joined in June 2025, received ₹11.5 crore and ₹8.3 crore respectively — reflecting a move toward a more professionalised leadership structure as Shadowfax prepares for listing.

Revenue Mix and Client Concentration

The company remains heavily reliant on e-commerce and hyperlocal deliveries, which together form nearly 90% of total revenue.

• Express logistics: ₹1,716 crore (69%)
• Hyperlocal: ₹513 crore (20.6%)
• Other services: ₹256 crore (10.3%)

Client concentration continues to be a structural risk — the top customer contributed 48.9% of H1 FY26 revenue, while the top five accounted for 74.6% in FY25.
Flipkart remains its largest client via Instakart Services Pvt Ltd and Flipkart Internet Pvt Ltd, which together contributed over ₹2,850 crore in FY25.

Workforce and Operations

As of September 2025, Shadowfax employed 4,472 permanent staff and 17,182 contractual workers, supported by over 2 lakh active delivery partners each quarter, making it one of India’s largest gig-driven networks.
Attrition fell sharply from 50% in FY25 to 15.3% in FY26, indicating improved workforce stability.
However, employee expenses rose to ₹2,655.8 crore, underscoring the labour-intensive nature of its business.

Risks and Structural Challenges

The DRHP flags several operational and financial headwinds:

• High client concentration: Heavy reliance on large e-commerce players such as Flipkart and Meesho.
• Rising lease costs: Liabilities surged to ₹1,322 crore in FY25 from ₹403 crore a year ago.
• Gig workforce risks: Dependence on non-exclusive partners could impact service continuity.
• Regulatory shifts: Implementation of India’s Social Security Code may increase compliance costs.
• Diversification risks: Forays into EV logistics, BFSI delivery, and dark stores are still in early stages.

The Road Ahead

The ₹2,000-crore Shadowfax IPO marks a pivotal test for India’s logistics-tech ecosystem. With profitability restored and governance strengthening, the company enters public markets with solid fundamentals.
Yet, its ability to sustain profits, diversify client exposure, and manage lease-heavy operations will define long-term investor confidence.

For investors, Shadowfax offers a rare combination of scale, profitability, and market leadership in a competitive logistics-tech sector — but the journey ahead will test whether its operational discipline can keep pace with growth ambitions.