Snapdeal Parent AceVector Files for IPO to Raise Rs 300 Cr

Snapdeal’s parent company, AceVector Limited, has filed its Updated Draft Red Herring Prospectus (UDRHP) with the Securities and Exchange Board of India (SEBI) for a proposed initial public offering (IPO) consisting of a fresh issue of equity shares and an offer for sale (OFS). The company plans to raise Rs 300 crore through the fresh issue, while existing shareholders will sell up to 6.39 crore shares as part of the OFS. Additionally, AceVector has kept the option open for a pre-IPO placement of up to Rs 60 crore, which, if undertaken, will reduce the size of the fresh issue accordingly.

The selling shareholders include promoter entity Starfish I Pte. Ltd., and investor shareholders Nexus India Direct Investments II, Nexus Ventures III, Nexus Opportunity Fund Ltd, Wonderful Star Pte. Ltd, Rupen Investment and Industries Private Limited, and Centaurus Trading and Investments Private Limited. Individual shareholders are also participating in the offer for sale (OFS).

The book-running lead managers to the issue are IIFL Capital Services Limited and CLSA India Private Limited, while MUFG Intime India Private Limited has been appointed as the registrar.

Founded in 2007 as Jasper Infotech, the company later rebranded as Snapdeal before becoming AceVector. It now operates across value e-commerce and software-as-a-service platforms through businesses such as Snapdeal, Unicommerce, Stellaro Brands, and Shipway, with Kunal Bahl and Rohit Kumar Bansal continuing to lead the group.

How will the proceeds be utilised?

AceVector plans to deploy the net proceeds from its initial public offering (IPO) primarily to strengthen the growth engines of its marketplace business. According to the UDRHP, the largest allocation, Rs 125 crore, will go towards marketing and business promotion, covering customer acquisition, brand-building campaigns, merchant onboarding, and performance marketing across digital channels. This spending will be phased across financial year (FY) 26 to FY28 to align promotional intensity with market conditions.

The company has also earmarked Rs 55 crore to upgrade and scale its technology infrastructure. This investment will expand platform capabilities, improve data processing and reliability systems, and enhance tools supporting seller management, logistics integration, and marketplace operations. Most of this outlay will be incurred between FY27 and FY29, as AceVector expects to fund a portion of its near-term tech requirements through internal accruals.

The remaining portion of the net proceeds will fund inorganic growth through acquisitions and general corporate purposes. However, the final allocation depends on the issue pricing. The prospectus caps this at no more than 35% of gross proceeds, with spending on either acquisitions or general corporate purposes limited to 25% of the gross issue size.

Cap Table

Important Performance Indicators

AceVector posted revenue from operations of Rs 395.02 crore in FY25, up from Rs 379.76 crore in the previous year, reflecting modest top-line growth despite continued losses. The company reported a restated consolidated loss of Rs 125.94 crore, widening from Rs 51.29 crore in FY24. This increase was driven by exceptional items, including a Rs 57.89 crore provision on an unutilised advertising security deposit and Rs 15.71 crore in legal and professional costs related to the Unicommerce IPO.

Snapdeal’s operations fall under the Marketplace segment, which generated Rs 249.87 crore in revenue in FY25, slightly lower than Rs 252.89 crore in the previous year.

However, core marketplace activity expanded significantly. During the six months ended September 2025, Snapdeal recorded a net merchandise value (NMV) of Rs 543.86 crore, up from Rs 381.02 crore in the same period last year. It delivered 12.99 million units and served 11.71 million annual transacting customers, both improvements from the previous year.

The software-as-a-service (SaaS) segment, led by Unicommerce and Shipway, continued its strong growth. Revenue rose 30.1% to Rs 134.79 crore in FY25, and the segment’s adjusted EBITDA margin improved to 18.8%, up from 15.6%.

Risk Factors

Continued losses

AceVector has reported restated losses of Rs 22.46 crore and Rs 110.39 crore for the six months ended September 2025 and September 2024, respectively, and Rs 125.94 crore, Rs 51.29 crore, and Rs 267.53 crore in FY25, FY24, and FY23. High spending on marketing, logistics, and employee costs keeps the company in the red, and the company warns it may continue to incur losses if growth and cost controls do not align. It warns that losses may continue.

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Net cash used in operations and financing

The company has historically used, rather than generated, cash from operating and financing activities. Net cash used in operating activities improved from Rs 209.39 crore in FY23 to Rs 54.85 crore in FY24 and Rs 27.35 crore in FY25, turning positive at Rs 5.07 crore in the six months ended September 2025.

Heavy dependence on Snapdeal marketplace

AceVector derives a substantial share of its revenue from the Snapdeal marketplace. Marketplace revenue contributed Rs 142.66 crore and Rs 116.21 crore in the six months ended September 2025 and September 2024, and Rs 249.87 crore, Rs 252.89 crore, and Rs 279.51 crore in FY25, FY24, and FY23, representing 58.37%, 64.14%, 63.25%, 66.59%, and 75.14% of total revenue. Any slowdown or disruption in Snapdeal poses a material risk.

Pending litigations

AceVector faces 82 consumer complaints, including cases naming promoters Kunal Bahl and Rohit Bansal, along with various criminal and regulatory proceedings. Quantified liability currently stands at Rs 0.082 crore.

Delays in payment of statutory dues

AceVector discloses past delays in paying statutory dues such as provident fund and employee state insurance contributions, labour welfare fund and tax deducted at source (TDS). Continued delays could attract penalties, interest and adverse orders from authorities. This, in turn, may negatively affect the company’s financial condition, cash flows and reputation for compliance.

Product quality and liability in the marketplace

AceVector does not control the quality of goods sold by third-party sellers. It faces potential consumer protection, health and safety and product liability claims if defective or unsafe products harm customers. Public complaints and litigation can damage the Snapdeal brand and erode trust, directly affecting business performance.

Fraud on the platform and fake Snapdeal sites

The company remains exposed to fraud, including allegations of non-receipt of goods, counterfeit products, seller non-payments, and fake websites misusing the Snapdeal name. While the company has filed cases against such sites and deploys fraud detection, gating and seller monitoring tools, it concedes these measures may not fully prevent fraud. Persistent fraud risks could increase losses and severely weaken seller and consumer confidence in the platform.

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