Exclusive: SUGAR Cosmetics To Raise $4.5 Mn From Anicut, Malabar At Flat Valuation

Mumbai-based D2C brand Sugar Cosmetics is set to raise INR 38 Cr ($4.5 Mn) from its existing investors Anicut Equity Continuum Fund, Elevation Capital, Malabar Investment, L Catterton, among others, its regulatory filing showed. 

As per Inc42’s calculations, the startup secured the fresh funding round at a valuation of INR 2,600- INR 2,700 Cr. This is almost the same valuation at which it raised $50 Mn in 2022. 

Responding to Inc42’s queries on the development, SUGAR cofounder and COO Kaushik Mukherjee said, “The investors who you have named are all existing shareholders of the company and some of the tranches of their investments may come into the company at different timelines.”

The fresh development has come almost a year after Malabar Investments acquired a stake worth INR 80 Cr in SUGAR from its existing investors – India Quotient and RB Investments. 

Sources told Inc42 that the startup may see another secondary transaction next year, giving exit to more of its early investors. 

SUGAR will likely use the fresh capital to scale Quench Botanics, a Korean Skincare brand it launched last year with Kareena Kapoor, the sources added.

Mukherjee said, “Our investments in FY25 are largely targeted towards scaling our skincare brand Quench Botanics that has seen strong traction in quick commerce and other ecommerce portals in the past six months. We have also earmarked some capital to build distribution for our more affordable range of colour cosmetics under the SUGAR POP sub-brand.”

Besides, the startup is also working to strengthen the distribution network of SUGAR POP. 

In the financial year 2023-24 (FY24), SUGAR reported an operating revenue of INR 505.1 Cr, a 20% increase from INR 420 Cr in the previous fiscal year.

The aforementioned sources said that while the startup intends to scale the business, the management is more focused on improving its bottom line. This was reflected in their FY24 financials, as the startup managed to narrow its loss by 11% to INR 67.6 Cr . 

SUGAR was founded by husband-wife duo of Vineeta Singh and Kaushik Mukherjee in 2015 as a D2C brand, with only an online platform. However, with omnichannel becoming the norm, the startup later followed the same model. Today, it claims to have a presence in over 45,000 retail stores across India. It has raised a total funding of around $90 Mn till date. 

The startup competes with the likes of Mamaearth, Nykaa, and international players such as Maybelline and Loreal, among others, in the fast-growing Indian beauty and personal care segment.