amara Capital and Xponentia Capital announced that they have exited their ownership (100% sale to Delhivery Private Limited) in SpotOn Logistics Private Limited (“SpotOn”), the fastest growing express logistics company in the Indian market. Samara and Xponentia had held the investment for a period of 3 years and the investment performance exceeds typical IRR and Money Multiple expectations.
In the last three years, SpotOn acquired RTS (a supply chain solutions business), setup two new verticals focused on “Air express” and “non-corporate customers” that significantly expanded the Company’s capabilities & product offerings. As a consequence, Net Sales and EBITDA of SpotOn grew at a CAGR of ~24% and ~30% respectively.
More importantly, SpotOn demonstrated its capabilities and the strength of its business model in the aftermath of the Covid lockdowns. While SpotOn’s business was severely impacted along with the economy during the lockdowns of H1FY21, the business rebounded sharply and the Company gained market share in H2FY21 on the back of smart execution by Management & financial backing provided by Samara and Xponentia.
Under the ownership of Xponentia Capital and Samara Capital:
– SpotOn continued to improve on its technology, usage of data analytics and build on its service culture both for the express business and the supply chain solutions business.
– SpotOn grew its active customer base by more than 1.5x.
– SpotOn created three new verticals
o Non-corporate customer vertical (paymet in advance as compared to corporate customers who enjoy credit) that is growing faster than other verticals & add significantly to margins and profitability.
o Air Express Vertical that allows customers choice of faster delivery &
o Supply chain solutions vertical through the RTS acquisition that completes its product offering.
Even as the Company invested in growth opportunities, SpotOn continued to deliver industry leading returns on capital (ROCE) of >30%.
Gautam Gode and Abhishek Kabra were the nominee Directors representing Samara Capital on the Board of SpotOn. Gautam Gode, Managing Director at Samara Capital said “SpotOn is a unique player in an otherwise legacy industry – controlled by PE funds from Day 1 and with a totally professional and best-in-class management. Delhivery has a similar provenance; that’s why we’re happy that SpotOn finds its next home in this new-age player.”
PR Srinivasan and Devinjit Singh were the nominee Directors representing Xponentia Capital on the Board of SpotOn. PR Srinivasan (PRS), Managing Partner at Xponentia Capital said “SpotOn achieved high growth by leveraging technology to set new standards in the industry. After being spun off in early 2012 with revenues of less than INR 12 crores a month, the Company has been able to grow close to INR 1000 crores a year, due to the emphasis on technology & data analytics”.
Abhik Mitra, Managing Director of SpotOn Logistics added, “the Company’s performance was enabled by a tightly knit board. The investment performance shows the power of collaboration between well aligned investors; the Samara and Xponentia teams have long history of shared accomplishments dating back to their days as Citigroup colleagues”.
Strategy Law Partners acted as the legal advisor to Samara Capital, Xponentia Capital and SpotOn Logistics on this transaction.