Investors are always on a quest to discover IPO’s worthy to invest in. One of such sort can be the IPO of Grofers. Grofers is an Indian online grocery delivery service. It was founded in December 2013 and is based out of Gurugram. As of 2018, the company has raised about $535.5 million from investors including SoftBank, Tiger Global and Sequoia Capital. The name Grofers is a portmanteau of “grocery gophers”. Grofer’s profitability has soared during the pandemic and is expected to sustain post-pandemic world as Information technology strengthens and becomes more and more imperative.
When is the IPO scheduled?
Softbank-backed Grofers has advanced its plan to launch an initial public offer by the end of next year, 2021. Grofers co-founder and CEO Albinder Dhindsa told PTI that the company started making operational profit in January and expects to become cash positive by the end of this year. Free Cash Flow means the company takes back home cash. They owe nothing. They are free from debt. Investors have a happy news. Even though a single years data doesn’t stand relevant in investing decisions but could be a good start from an IPO’s perspective.
What investors need to know about Grofers?
During the corona virus pandemic in 2020, Grofers along with Amazon India and Big Basket were among the few online grocery platforms that continued to operate in India. “Our path to profitability has accelerated during the lockdown, and after achieving operational profitability in January, we are on track to become EBITDA and cash positive by the end of this year. We are observing market sentiments and aim to hit the capital market by the end of 2021,” Dhindsa said. According to the data shared by the company, Grofers shipped 4.4 crore items last month, with 99.7% accuracy and since the lockdown began. It claims to have served 42 lakh households by the end of May. “Our platform continues to witness high demand and we expect this to stabilize at 30% higher than pre-Covid levels. There has also been a 40% increase in basket size as compared to the pre-COVID era.
During the lockdown, Grofers opened three new facilities and two more are in the pipeline at Bhiwadi and Lucknow. “We are looking to add 10-15 facilities before the end of this year. We are helping our manufacturing partners with logistics, working capital, and distribution so that we can maintain constant supplies of goods for our customers. We started reverse picks on our own trucks and procured.
Also, He said that the company has identified and hired delivery and warehouse personnel from the companies operating in industries deeply impacted by the current crisis such as textiles and car rentals.
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