Peak XV Sitting On 10X Gains From Investment In Mamaearth

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SUMMARY

Mamaearth is Peak XV’s fourth investment in the country that has offered a 10X or greater returns in the past six months since split from parent Sequoia.

Mamaearth will be Peak XV’s 20th IPO in India and the larger Southeast Asian region, a ‘substantially’ higher IPO count than many of its peers in the region

Last week, Mamaearth’s public issue was oversubscribed 7.61X as demand poured in from QIBs and retail investors

Venture capital (VC) firm Peak XV Partners, formerly Sequoia Capital India, is reportedly sitting on a 10X return on its investments in Mamearth following the D2C unicorn’s oversubscribed public issue.

As per TechCrunch, Mamaearth is Peak XV’s fourth investment in the country that has offered a 10X or greater returns in the past six months since the split from parent Sequoia.

It is pertinent to note that the price band for Mamearth’s IPO has been set in the range of INR 308-INR 324 per share. At the upper limit, Sequoia would have acquired the D2C unicorn’s stock at under INR 30-32 a share.

According to the report, this will be Peak XV’s 20th IPO in India and the larger Southeast Asian region, a ‘substantially’ higher IPO count than many of its peers in the region.

Last week, Mamaearth’s public issue was oversubscribed 7.61X as demand poured in from qualified institutional buyers (QIBs) and retail investors. The startup is eyeing to raise up to INR 1,700 Cr via its IPO at a valuation of $1.2 Bn.

The public issue comprised a fresh issue of shares worth INR 365 Cr and an offer for sale (OFS) element of 4.12 Cr shares. The price band has been set in the range of INR 308-INR 324 per share.

This comes close on the heels of Peak XV Partners reportedly selling its remaining stake in foodtech giant Zomato at a more than 10X return, bringing the shutters down on the decade-long investment journey.

Prior to that in September, the VC firm also encashed a hefty 12X-plus return on its investment in K12 Techno Services after Kedaara Capital invested in the edtech startup.

The hefty returns give a major boost to the VC firm’s operations in the country which have been mired by standoffs with cofounders, weak returns in the past two years due to market volatility, and floundering revenues of some of the portfolio startups.

Peak XV Partners oversees a capital pool of $2.5 Bn, and has focussed a big chunk of its energies on targeting homegrown startups. Since its split from Sequoia Capital, Peak XV Partners has been on a term signing spree. It has so far made more than 400 investments in the India and SEA region.

Besides, the VC firm also has 40 Indian startups under its belt that have revenue in excess of $100 Mn.

As per the report, the company recently marked up the estimated value of four of its six funds, while earning hefty returns from a spree of listings and offloading of shares. Recently, Peak XV also undertook the sale of its shares in the publicly listed Go Colors and sale of stake in Quick Heal.