Mamaearth IPO: Shares End First Trading Session 4% Higher From Listing Price

Shares of Honasa Consumer Ltd, the parent entity of D2C unicorn Mamaearth, ended Tuesday’s (November 7) trading session at INR 337.15 on the BSE, up 4.06% from their listing price.

The new-age tech startup made almost a flat debut on the Indian bourses today. While its shares listed at a 2% premium at INR 330 on the NSE, Mamaearth shares listed at INR 324 on the BSE.

The price band for the IPO was set at INR 308-INR 324. 

Mamaearth shares jumped almost 5% to INR 340 during the intraday trading, but later pared some of the gains to settle at 4% above the IPO price.

On the NSE, the shares ended the trading session at INR 337.3, up 2.21% from the listing price.

Mamaearth’s market cap currently stands at $1.3 Bn.

Founded by the husband-wife duo of Ghazal and Varun Alagh in 2016, Honasa Consumer retails several beauty and personal care brands, including Mamaearth, The Derma Co., Ayuga, Aqualogica and Dr Sheth’s. The company filed its draft red herring prospectus (DRHP) in December last year. 

The IPO was oversubscribed 7.61X, with the highest demand coming from qualified institutional buyers (QIBs).

The public issue comprised a fresh issue of shares worth INR 365 Cr and an offer for sale (OFS) component of 4.12 Cr shares. However, the company’s loss of INR 151 Cr in FY23 raised concerns in some quarters about the stock’s outlook for the near to medium term.

Meanwhile, the early investors in the company, many of whom sold their shares through the OFS route, made big gains from the IPO.

At the upper end of the IPO listing price, INR 324, Snapdeal cofounders Rohit Bansal and Kunal Bahl made nearly 101X returns on their initial investment, while actor Shilpa Shetty’s returns stood at about 7.74X. 

On the other hand, Mamaearth is reportedly Peak XV’s fourth investment in the country to offer a 10X or greater returns in the past six months since the split from its parent Sequoia.