India's PE-backed Coldex files for IPO
Indian cold chain logistics provider Coldex has filed for an IPO that will provide a partial exit to Asia Climate Partners (ACP), an investment vehicle backed by the Asian Development Bank (ADB), Orix Corp, and Robeco Institutional Asset Management.
According to the prospectus Coldex will issue up to 2.7 million shares, including 1 million freshly issued shares and 1.7 million shares held by ACP. Pricing for the shares has not been announced. ACP’s sale will leave it with 2.1 million shares following the IPO.
Coldex was founded in 1999 as Swastik Roadlines, a dry logistics player, but changed to its current name after moving into the cold chain space in 2005. The company claims to be India’s largest organized integrated food supply chain and distribution business, catering to a range of sectors including fast-moving consumer goods, food services, dairy, restaurants, and frozen food retail.
Coldex operates five temperature-controlled warehouses with a capacity of more than 7,000 pallets, and more than 800 refrigerated trucks directed from 12 operating locations. Its clients include Burger King, Yum Brands, Cadbury, and Starbucks. Proceeds from the IPO will be used for investments in Coldex’s IT infrastructure, acquisitions and other strategic initiatives.
For the year ended March 2018, Coldex reported revenue of INR2.6 billion ($37.9 million), up from INR2.3 billion the previous year. Over the same period the company went from a INR162 million net loss to a net profit of INR31 million.
ACP invested in Coldex in 2016, buying newly issued shares along with stakes held by India Equity Partners, which invested in 2010, and Arihant Roadlines. The fund currently holds a 42% stake in the company.
India’s cold chain logistics industry is expected to expand rapidly in coming years, fueled by demand from growing domestic industries such as quick-service restaurants, pharmaceuticals, and modern grocery stores and supermarkets. The cold chain space is currently dominated by local and regional players but seen as open for nationwide players to emerge thanks to government initiatives like the goods and services tax regime that reduce barriers to interstate logistics.
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