Audio-tech startup boAt files for Rs 2,000 Cr IPO; to use proceeds to repay, prepay debt

The Delhi-based D2C startup has raised around $116 million in funding to date from investors including Warburg Pincus, Qualcomm Ventures, InnoVen Capital, and Fireside Ventures, among others.
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Imagine Marketing, the company behind boAt Lifestyle, on Thursday filed for an initial public offering (IPO) to raise up to Rs 2,000 crore with the Securities and Exchange Board of India (SEBI).

According to its draft red herring prospectus (DRHP), the startup plans to raise Rs 2,000 crore via a fresh issue of shares worth Rs 900 crore, and an offer for the sale of shares (OFS) worth Rs 1,100 crore. An OFS allows the promoters of a company to reduce their stakes in a company by selling to the general public.

The proceeds raised from the share sale will be used by boAt to repay or prepay its debt, as well as invest in business growth and expansion.

Founded in 2016 by Sameer Mehta and Aman Gupta, boAt has clocked record growth over the past two years as lockdowns induced by COVID-19 not only increased consumers' appetite for better entertainment as they stayed home, but also led to an increase in usage of earphones and quality audio equipment for video conferencing at work.

boAt reported a net profit of Rs 78 crore in FY ending March 31, 2021, and revenue of Rs 1,500 crore.

The startup was valued at Rs 2,200 crore in its last fundraise from Qualcomm Ventures when it raised Rs 50 crore. The IPO could value boAt at $1.5-2 billion, according to reports.

Aman Gupta (left) and Sameer Mehta, Co-Founders, boAt

Sameer and Aman, who own 56 percent of the company, are expected to dilute a minor part, while its largest shareholders, South Lake Investment, could divest shares worth Rs 700-800 crore.

In recent times, a slew of startups has made their way to the capital markets, including Zomato, Nykaa, Paytm and PolicyBazaar, among others. While most of the eight tech startups that listed last year saw strong consumer traction and market debuts since the start of 2022, their shares have declined due to broader market volatility, leading to an erosion of Rs 38.171 crore ($5.1 billion) in total market value.

Edited by Kanishk Singh

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