India's Shadowfax shares slide in market debut over client risk
India’s logistics startup Shadowfax stumbled in its stock market debut on Wednesday, with shares falling as investors weighed concerns over the company’s heavy reliance on a small group of large e-commerce clients.
The Bengaluru-based firm raised about ₹19.07 billion (around $208.24 million) through its initial public offering, News.Az reports, citing TechCrunch.
Shares of Shadowfax dropped about 9% from the issue price of ₹124 to ₹112.60, valuing the company at roughly ₹64.7 billion (around $706.58 million) at listing. That valuation broadly matched its last private valuation of close to ₹60 billion (around $655.01 million) in early 2025. The IPO, priced in a band of ₹118–124 per share, comprised a fresh issue of shares along with an offer-for-sale by existing shareholders and was subscribed nearly three times.
Founded in 2015, Shadowfax operates as a third-party logistics provider, focusing on last-mile and intra-city deliveries for e-commerce marketplaces, quick-commerce platforms, and consumer internet companies across India. Its major clients include Flipkart, Meesho, Zepto, and Zomato. Together, these clients account for about 74% of Shadowfax’s revenue, according to its prospectus. Key shareholders include Flipkart, TPG NewQuest, Qualcomm, and the World Bank-backed International Finance Corporation.
The company’s listing comes as India’s e-commerce and quick-commerce sectors continue to expand, supported by rising internet penetration, urbanisation, and demand for faster delivery services. Platforms offering same-day or rapid fulfilment have increasingly relied on third-party logistics providers to scale nationwide, placing companies such as Shadowfax at the centre of India’s consumer internet supply chain.
The IPO included shares sold by several early and institutional investors, including Flipkart, Eight Roads Ventures, Nokia Growth Partners, Qualcomm, and Mirae Asset. Shadowfax’s founders, Abhishek Bansal and Vaibhav Khandelwal, did not participate in the offer-for-sale and will together retain about 20% of the company following the listing.
“We don’t see this IPO as a destination,” said Bansal, Shadowfax’s co-founder and chief executive officer, during the IPO launch ceremony in Mumbai. “We are not building this for the next quarter. We are building this for the next century. Today, we don’t ring a bell. We are waking up to a new set of possibilities.”
For the six months ended September 2025, Shadowfax reported revenue from operations of ₹18.06 billion (around $197.12 million), representing a 68% increase from the same period a year earlier, according to its prospectus. Profit more than doubled year on year to ₹210.37 million (about $2.30 million), driven by higher delivery volumes, although earnings remain closely linked to demand from a limited number of large platform clients.
The company said proceeds from the fresh issue will be used to fund capital expenditure for expanding its logistics network, pay lease costs for new first-mile, last-mile and sorting centres, and cover branding, marketing and communication expenses. Part of the funds will also be set aside for inorganic acquisitions and general corporate purposes.
Shadowfax currently operates around 3.5 million square feet of logistics infrastructure across 14,700 pin codes nationwide.
The listing comes more than three years after its larger rival Delhivery went public in 2022. Delhivery reported revenue of about ₹89.3 billion (around $974.84 million) for the year ended March 2025, with year-on-year growth in the low teens, highlighting the contrast with Shadowfax’s faster pace of expansion.
By Nijat Babayev
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