CDC Group pumps in $36 mn in Indian logistics firm Ecom Express
CDC Group, the UK’s development finance institution and impact investor in South Asia and Africa, has announced that it has closed a $36 million equity investment in Warburg Pincus-backed Ecom Express.
December 12, 2019: CDC Group, the UK’s development finance institution and impact investor in South Asia and Africa, has announced that it has closed a $36 million equity investment in Warburg Pincus-backed Ecom Express, one of the fastest-growing tech-enabled end-to-end Indian logistics company.
Ecom Express is renowned for its speed, safe and reliable nation-wide express delivery services for the e-commerce industry. Ecom Express’ network reaches over 90 percent of India’s population, with more than 85 percent of its presence in Tier 2/3/4 cities and hinterlands. The network empowers and connects sellers and consumers, thereby enabling the growth of the e-commerce industry and its surrounding ecosystem.
Srini Nagarajan, managing director and head of Asia CDC, said, “In Ecom Express, we have a partner company that recognises the vital importance of creating a genuinely sustainable and gender-inclusive business. I am delighted that, through our expertise in impact investing in support of the UN’s Sustainable Development Goals, we will be adding value far beyond our capital contribution. We are dedicated to responsibly investing our capital in India, with over $1.7bn currently committed to local businesses. We have the same amount again to invest over the next few years and look forward to working with many more businesses that are as environmentally and socially conscious as Ecom Express."
In addition to network expansion and augmentation, CDC’s equity injection enables Ecom Express to significantly accelerate job creation from 32,000 employees to 47,000 within the next 1-2 years. This will be complemented by a distinct focus on increasing the number of employed women in the workforce, bringing further diversity.
T A Krishnan, co-founder and CEO of Ecom Express said, “We are truly delighted to welcome CDC as our partner. The infusion of capital will help us further expand our delivery footprint in connecting towns and rural centers across the country. Besides expanding reach, the company plans to invest in technology, deploy advanced parcel sortation systems, strengthen network reliability and infrastructure, and finally, make development impact with job creation, environmentally responsible initiatives and gender diversity. These initiatives will help us deliver superior customer experience and build a scalable and sustainable business. We look forward to leveraging CDC’s expertise in driving businesses with socially responsible and environmental initiatives and the firm’s global network of relationships.”
Furthermore, CDC’s commitment to working with investees to address transformational climate urgency measures will be demonstrated through this partnership with Ecom Express. The fund, as part of the initiatives, will work with Ecom Express to transition a proportion of its distribution fleet to electric vehicles and sponsor a road safety programme for its drivers and fleet operators.
CDC has investments in over 1,200 businesses in emerging economies and a total portfolio value of £5.8 billion. This year CDC will invest over $1.5 billion in companies in Africa and Asia with a focus on fighting climate change, empowering women and creating new jobs and opportunities for millions of people. CDC is funded by the UK government and all proceeds from its investments are reinvested to improve the lives of millions of people in Africa and South Asia.