Volatile world gives a tailwind for Ofbusiness
Ofbusiness is not your typical e-commerce company. For one, it’s profitable. In fact, it’s been profitable for seven out of its eight years of existence—a rare feat for Indian startups, many of which have been struggling to cope with a funding freeze and moderating growth in the past few years.
The online raw materials marketplace for businesses, on the other hand, expects its FY24 profit to jump by 50% from a year earlier, a period fraught with global economic uncertainties and geopolitical tensions. For Ofbusiness, though, this has turned out to be a blessing, enough for it to relaunch its process for an initial public offering of its shares.
The company had planned to go public last year, but deferred its IPO citing unstable market conditions. Later in the year, Ofbusiness approached sovereign wealth funds, private equity funds, and crossover funds to raise $150-200 million at a valuation of $6 billion, as Mint reported in November. Ofbusiness denied the development.
While Ofbusiness has benefrom the China-plus-one strategy, a push for global businesses to diversify their supply chains and assembly lines, the company has in recent times found another factor playing in its favour: Uncertain global macroeconomic conditions and geopolitical tensions, which have encouraged businesses to prioritize India as a sourcing destination.
“In the last 3-4 years, this is the largest significant tailwind that has come about,” said Asish Mohapatra, co-founder and chief executive officer of Ofbusiness.
The company now plans to tap the public markets in 12-15 months, after hitting ₹1,000 crore in after-tax profit, a target Mohapatra expects to reach in the ongoing financial year.
Before listing, Ofbusiness also has to ensure that the companies it has acquired also comply with the same level of governance norms as the parent company, Mohapatra said.
“We are very much in the process of it... we will appoint bankers in about 3-6 months,” Mohapatra said, adding that the company will likely file its draft red herring prospectus (DRHP) by the end of this year. He did not disclose more details