FirstCry files paper for IPO, to raise Rs 1,816 crore
NEW DELHI: In the ongoing bull run seen in the primary, as well as secondary market, Brainbees Solutions, the parent firm of omnichannel retailer FirstCry, has filed a draft red herring prospectus (DRHP) with the market regulator Security Exchange Board of India (Sebi) for launching an initial public offering (IPO).
As per the DRHP, FirstCry will be aiming to raise funds through a fresh issue of equity shares aggregating up to Rs 1,816 crore and an offer for sale (OFS) of up to 54,391,592 equity shares. The total size of the IPO is expected to be more than Rs 4,000 crore as the Pune-based company is aiming to issue its initial shares to the public at a valuation of around $4 billion.
According to reports, the SoftBank-backed company was last valued at under $3 billion in the private market. SoftBank, the Japanese investment firm, is the largest external stakeholder in FirsCry with 25.55% stake. Other big stakeholders are Mahindra & Mahindra (10.99% stake) and Premji Invest (10.36% stake). DHRP showed SoftBank will be selling 2 crore shares, Mahindra Retail offloading 28 lakh shares and Premji Invest selling 86 lakh shares in the IPO.
Ratan Tata will sell all his 77,900 shares in the IPO. The business tycoon had picked up a 0.02% stake for Rs 66 lakh in the company in 2016. Other investors such as New Quest Asia, Apricot Investments, Valiant Partners, among others, and the four co-founders will be diluting their stake in the OFS.
The company, which focuses on children’s merchandise and apparel, said that it use the net proceeds from the issue for setting up said it will utilize the proceeds for setting up modern stores, warehouses, investment in its subsidiaries, technology and data science, marketing, acquisitions, and general corporate purposes. The company is also eyeing international expansion in Saudi Arabia.
Launched in 2010, FirstCry has seen exponential growth in the last few years and has become one of the few e-commerce firms to have revenue of over Rs 5,000 crore. The company’s revenue from operations surged from Rs 2,401 crore in FY22 to Rs 5,632 crore in FY23. However, its losses also grew six-fold to Rs 486 crore in FY23 from Rs 79 crore in FY22