FirstCry IPO sees tepid response; gets subscribed 11% on day one

Brainbees Solutions, the parent company behind FirstCry’s IPO was subscribed 11% on the first day with employees leading with booking 1.57 times.

The non-institutional investor category purchased 8% of their allocated shares, while qualified institutional buyers purchased 0.01% shares allocated to them by the end of day one. Subscriptions from retail investors saw some traction with 46%.

Mumbai-based kidswear brand raised Rs 1,885.8 crore (approximately $224.48 million) ahead of its Rs 4,194 crore public offering from anchor investors. The pre-IPO round was raised from 71 anchor investors at an upper share price band of Rs 465 per equity share. Anchor investors were allocated a total of 4.05 crore equity shares, with approximately 37.38% of these shares going to eight domestic mutual funds.

The company, which sells baby and mother care products, has set its IPO price band in the range of Rs 440 to Rs 465 per equity share for its nearly $3 billion IPO. The offer closes on Friday, August, 9.

It plans to list on domestic bourses by August 11. 

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Founder and CEO Supam Maheshwari is not selling any stake in the IPO. SoftBank will pare its stake to about 20% from 25% earlier while Mahindra & Mahindra will participate in OFS with 10% of its total shareholding in the company by selling 28.06 lakh equity shares.  FirstCry doesn’t have any promoters backing it up and its selling shareholders, except Schroders, together diluting around 11% of their total share capital in the OFS. 

The company posted a revenue of Rs 6480.9 crore with an Adjusted EBITDA margin of 4.2% in FY24. It saw a pre-tax loss of around Rs 350 crore in FY24. During the same period, it had 9.1 million annual unique transacting customers. Its gross merchandise value for India grew 18.8% to Rs 7582.7 crore in FY24. 

The omnichannel retailer had initially withdrawn its IPO papers in April after SEBI sought info on key performing indices of the company according to its DRHP. It later filled them with disclosure on performing metrics.