IPO-Bound FirstCry Files DRHP; To Raise INR 1,816 Cr Via Fresh Issue

FirstCry FY24: Loss Narrows 34%, Revenue Crosses INR 6K Cr Mark Ahead Of IPO

SUMMARY

Japan’s SoftBank which owns of 25% will sell up to 2 Cr equity shares in the offer for sale portion of the public issue

The startup will use the IPO net proceeds for expenditure for setting up new modern stores, warehouses, as well as lease payments across India

In Q1 FY24, the company incurred a loss of INR 110 Cr and has 8.25 Mn annual unique transacting customers as of June 30, 2023

Pune-based omnichannel marketplace FirstCry’s parent entity BrainBees Solutions Limited has filed draft red herring prospectus (DRHP) with the market regulator SEBI. The Supam Maheshwari-led ecommerce unicorn is looking to raise INR 1,816 Cr through fresh issues of shares.

The offer also includes an offer-for-sale (OFS) component comprising 5.4 Cr equity shares. Japan’s SoftBank, which owns over 25% stake, will sell the most with up to 2 Cr equity stakes, whereas Premji Invest will sell 8.6 Mn shares during the OFS. Founder Supam Maheshwari will also sell his stake in the IPO.

The startup will utilise the net proceeds from the IPO for the following:

Expenditure for setting up new modern stores and warehouses, as well as lease payments for our existing modern stores in India, totalling INR 648 Cr.
Investment in the company’s subsidiary FirstCry Trading for overseas expansion via setting up new modern stores in Saudi Arabia totalling INR 155.6 Cr.
INR 170.5 Cr as an investment in subsidiary Globalbees Brands towards the acquisition of an additional stake in the company’s indirect subsidiaries.
Investment for sales and marketing initiatives to the tune of INR 100 Cr.
Technology and data science cost of INR 57.6 Cr.
The rest would be for funding inorganic growth through acquisition, other strategic initiatives, and general corporate purposes.

The company is also eyeing a pre-IPO private placement of equity shares to certain investors for an amount aggregating up to INR 363 Cr. The amount raised in the pre-IPO round will be reduced from the fresh issue.

For the three months ending June 30, 2023, the company lost INR 110 Cr. The startup had 8.25 Mn annual unique transacting customers as of June 30, 2023.

In FY23, FirstCry’s net loss surged over 500% to INR 486 Cr from INR 78.6 Cr in the previous fiscal year. Notably, the startup had logged a net profit of INR 215.9 Cr in FY21. The startup clocked a sales of INR 5,632.5 Cr in FY23, a 135% from INR 2,401.2 Cr in FY22.

FirstCry’s consolidated financials include the financial performance of its 38 subsidiaries, including Globalbees.

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