Zetwerk, the $3 billion manufacturing startup backed by Peak XV Partners and Accel, is preparing to file draft papers within the next six months for an initial public offering with an aim to raise $400-500 million, sources familiar with the matter said.
The IPO will include a small secondary component, and the company has appointed Axis Bank, Goldman Sachs and Kotak Mahindra as its bankers for the issue, the sources added.
The outer limit to file the IPO papers is nine months, but the Bengaluru-based firm is keen to be listed this calendar year, they said.
Zetwerk is targeting a valuation exceeding $5 billion as it expands its global footprint, particularly in the US, and doubles down on in-house manufacturing capabilities. It connects suppliers and manufacturers based on project requirements but has also started focusing on undertaking some of these projects in-house.
“A couple of more bankers will be added, but Axis is the left lead (lead bookrunner) on the issue for which they are looking at an around 10% dilution to raise $400–500 million,” a person aware of the matter said. Since the company was started only six years ago, the secondary component — where existing investors sell their stake — will be small, this person said.
A spokesperson for Zetwerk declined to comment.
The company has so far raised $768 million. Besides Peak XV Partners and Accel, its investors include Lightspeed Venture Partners, Greenoaks and Avenir Growth Capital.
Zetwerk’s plan adds to the IPO wave in the business-to-business segment, with Infra.Market and OfBusiness also moving towards filing their IPO applications with market regulator Sebi.
Infra.Market, an online marketplace for construction materials, closed a $121 million (Rs 1,050 crore) pre-IPO funding round last month from investors such as Tiger Global, Evolvence and Zerodha cofounder Nikhil Kamath.
OfBusiness, a B2B ecommerce company, has converted itself into a public limited entity as part of its IPO preparations, regulatory filings showed. The $5 billion OfBusiness, backed by SoftBank, Z47 (earlier Matrix Partners India) and Alpha Wave Global, is planning for an IPO in the range of $750 million to $1 billion. Early investor Zodius Capital exited the firm netting over $100 million, while Z47 is in the middle of talks to sell a part of its stake, ET reported last October.
Zetwerk is onboarding large international clients while growing its production operations. It recently scored a $100 million-plus order from a large European multinational while also working with one of the top consumer electronics firms for its India business. It currently has an order book of around Rs 14,000 crore.
Ahead of the IPO, Zetwerk is in the process of closing a $100 million pre-IPO funding round, with $70 million already secured from Silicon Valley-based Khosla Ventures, UK investment firm Baillie Gifford and others. The remaining $30 million is expected to come from family offices.
Zetwerk reported operating revenue of Rs 14,436 crore for FY24, up 25% from the prior year, even as gross merchandise value rose 35% to Rs 17,564 crore. Its loss, however, tripled to Rs 470 crore due to its exit from the textile and apparel sector, as it has shifted focus towards renewables, aerospace and defence, and electronics.
Zetwerk undertook these changes as part of its strategic shift to build a more sustainable and profitable business over the long term, as per people aware of its plans.
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The outer limit to file the IPO papers is nine months, but the Bengaluru-based firm is keen to be listed this calendar year, they said.
Zetwerk is targeting a valuation exceeding $5 billion as it expands its global footprint, particularly in the US, and doubles down on in-house manufacturing capabilities. It connects suppliers and manufacturers based on project requirements but has also started focusing on undertaking some of these projects in-house.
“A couple of more bankers will be added, but Axis is the left lead (lead bookrunner) on the issue for which they are looking at an around 10% dilution to raise $400–500 million,” a person aware of the matter said. Since the company was started only six years ago, the secondary component — where existing investors sell their stake — will be small, this person said.
A spokesperson for Zetwerk declined to comment.
The company has so far raised $768 million. Besides Peak XV Partners and Accel, its investors include Lightspeed Venture Partners, Greenoaks and Avenir Growth Capital.
Zetwerk’s plan adds to the IPO wave in the business-to-business segment, with Infra.Market and OfBusiness also moving towards filing their IPO applications with market regulator Sebi.
Infra.Market, an online marketplace for construction materials, closed a $121 million (Rs 1,050 crore) pre-IPO funding round last month from investors such as Tiger Global, Evolvence and Zerodha cofounder Nikhil Kamath.
OfBusiness, a B2B ecommerce company, has converted itself into a public limited entity as part of its IPO preparations, regulatory filings showed. The $5 billion OfBusiness, backed by SoftBank, Z47 (earlier Matrix Partners India) and Alpha Wave Global, is planning for an IPO in the range of $750 million to $1 billion. Early investor Zodius Capital exited the firm netting over $100 million, while Z47 is in the middle of talks to sell a part of its stake, ET reported last October.
Zetwerk is onboarding large international clients while growing its production operations. It recently scored a $100 million-plus order from a large European multinational while also working with one of the top consumer electronics firms for its India business. It currently has an order book of around Rs 14,000 crore.
Ahead of the IPO, Zetwerk is in the process of closing a $100 million pre-IPO funding round, with $70 million already secured from Silicon Valley-based Khosla Ventures, UK investment firm Baillie Gifford and others. The remaining $30 million is expected to come from family offices.
Zetwerk reported operating revenue of Rs 14,436 crore for FY24, up 25% from the prior year, even as gross merchandise value rose 35% to Rs 17,564 crore. Its loss, however, tripled to Rs 470 crore due to its exit from the textile and apparel sector, as it has shifted focus towards renewables, aerospace and defence, and electronics.
Zetwerk undertook these changes as part of its strategic shift to build a more sustainable and profitable business over the long term, as per people aware of its plans.
