Upcoming IPO a key milestone, says Shiprocket CEO amid online, qcom boom

Shiprocket Co-Founder and CEO Saahil Goel sees the upcoming IPO is a key milestone reflecting internal discipline, scale and governance, and believes it will set the logistics tech company on a new growth trajectory with India's direct-to-consumer, online and quick commerce space poised to boom.

Shiprocket, backed by marquee investors like Temasek, Zomato and Paypal, had submitted its draft red herring prospectus (DRHP) with Sebi via the confidential route earlier this year, an increasingly popular option among Indian startups as it allows vital financial and strategic information to remain undisclosed during the initial review while the firm obtains necessary feedback from the regulators.

Goel told PTI in an interview said the IPO will be an important milestone as it "institutionalises" the company that has evolved from being a shipping partner to an end-to-end e-commerce enablement platform for Indian merchants.

According to Goel, it brings discipline, and aligns stakeholders for long-term productive returns, but is by no means an end in itself.

"The IPO moment is an interesting milestone. It is obviously a good validation of discipline and scale we've built, and of governance," said Goel, who alongside management of the company, actively heads product strategy, user experience, and growth initiatives.

Goel emphasised that the IPO does not mark the end of the journey but rather the beginning of a new phase, and likened the company to an adolescent poised for the long haul.

"I think of the company as a child, 13 years old. So, this is adolescence, and we've still got a long way to grow and mature. I think it is that point in the company's life," he said.

On the expected timelines for listing, Goel said, "I don't want to comment, but it will be next year."  With its technology stack, Shiprocket integrates shipping, fulfilment, customer communication, marketing tools, and commerce infrastructure for MSMEs, D2C brands, and social commerce retailers across India. Its logistics data platform connects retailers, carriers, and consumers across national and overseas locations.

"Shiprocket basically enables small businesses to go online and successfully grow their business. We're bringing the right tools, everything from marketing to payments to shipping to let anybody easily plug these together and start or scale their business," Goel said, adding that the company is ready for the next phase, which he believes will bring challenges and opportunities different from those faced in the formative years.

"E-commerce is growing at a certain clip, between an estimated 20 and 30 per cent. Within that, you'll see that quick commerce, direct commerce, the segment we play in, are growing at a faster clip than traditional marketplace commerce. So there is already tailwind because this is a newer emerging form of commerce that we power," said Goel.

At the same time, factors like rising urban spending and a surge of first-time shoppers from tier-2 and tier-3 cities is boosting demand, he noted.

Goel said this multi-pronged opportunity allows Shiprocket to participate in multiple growth vectors. According to him, Shiprocket will focus on three growth engines: the 'marketing stack' to help its 1.75 lakh sellers optimise order generation on marketing platforms; in expanding omni-channel logistics and fulfilment backed by demand; and strengthening cross-border services, which despite "geopolitics" and "macro changes" continues to be a "promising area" given India's exports and manufacturing push.

"Cross-border services continue to be a very promising area. As manufacturing grows, as push for export grows, there are going to be lots of schemes, lots of things that the government is going to do, merchants will want to capture higher AOVs (average order value), more premium products will get built in India for us, which will have markets abroad.

"So if you take a take 5-7 year view, I think export will generally do very well," he said.

At the same time, Shiprocket continues to drive higher operating leverage and focus on expansion of contribution margins across its core business, he said.

AI remains a core area for innovation to create scalable, profitable solutions. The company focuses on developing and testing AI-driven solutions to achieve product-market fit, then scaling these through marketing and incentives, he added.

Shiprocket will consider 'right-fit' acquisitions but only where it has the potential to deliver stronger returns than building in-house.

"I think we take a very, very dispassionate lens to M&A because we know our strategy. We're not going to change our direction because something has come about and we do it largely because something can help us drive higher returns sooner," he said.

Shiprocket's revenue grew 24 per cent year-on-year to Rs 1,632 crore in FY25, with core business revenue (domestic shipping platform and value-added tech offerings) rising over 20 per cent to Rs 1,306 crore.

Emerging businesses grew 41 per cent, driven by greater adoption of cross-border platform, marketing, and omnichannel offerings.

The company cut losses to Rs 74 crore in FY25 from Rs 595 crore in FY24, and said the current losses were largely attributable to ESOP expenses of Rs 91 crore. It reported positive cash EBITDA for FY25 of Rs 7 crore, versus a burn of Rs 128 crore in FY24.

"From a profitability perspective, I feel we are well-positioned to be able to dial this the way we want. At the moment, we think we need to optimise where we aren't burning cash unreasonably but at the same time, we are being able to drive the maximum growth... because this business is in infancy," he said.

He noted that e-commerce penetration is only about eight per cent in India and nowhere near saturation.

"It's getting built... We are 'unit economics' positive... but we'll invest in people, we will put engineers behind it (technology), and that will take some cost," he said.

In simple terms, 'unit economics' refers to measuring a company's profitability on a per-unit basis.