Honasa Consumer, the parent company of the popular personal care brand Mamaearth, has announced its intention to go public with an initial public offering (IPO).
The IPO is scheduled to be open for subscription from October 31 to November 2, with shares being priced in the range of Rs 308 to Rs 324 each. The upper end of this price range is aimed at raising a substantial Rs 1,701 crore, effectively valuing the company at Rs 10,425 crore.
This IPO is composed of both a fresh issuance of shares worth up to Rs 365 crore and an offer for sale (OFS) valued at Rs 1,336 crore. Anchor investors will have the opportunity to place their bids starting on October 30.
Notably, this marks a slight deviation from the initial plans outlined in the draft red herring prospectus issued in December of the previous year. The initial proposal included a fresh issue of Rs 400 crore and an OFS of 46.82 million shares, which has now been scaled back to 41.25 million shares.
Key stakeholders in this IPO include Varun Alagh and Ghazal Alagh, who plan to sell 3,186,300 shares (Rs 103 crore) and up to 100,000 shares (Rs 3 crore), respectively. According to the pre-IPO shareholding pattern, the promoters jointly possess a 37.41% stake in the company.
Furthermore, investors Stellaris Venture Partners and Sofina are set to sell shares valued at up to Rs 355 crore and Rs 310 crore, respectively. Fireside Ventures also plans to divest shares amounting to Rs 258 crore, while Rishabh Mariwala from Marico intends to sell his stake for up to Rs 185 crore. Additional stakeholders participating in the OFS include Snapdeal co-founders Kunal Bahl and Rohit Bansal, along with actor Shilpa Shetty Kundra.
The bid lot size for the IPO has been set at 46 shares per lot, translating to a minimum bid lot amount of Rs 14,904 in the retail category.
Approximately 10% of the issue size is reserved for retail investors, with 15% allocated to High Net Worth Individuals (HNIs), and the remaining 75% designated for qualified institutional buyers (QIB).
The IPO extends a discount of Rs 30 per equity share to eligible employees participating in the employee reservation portion, with Honasa setting aside Rs 1 crore worth of shares for its employees.
The listing of the stock is scheduled to take place on both the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) on November 10. The finalization of the basis of allotment is expected to be completed by November 7.
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The net proceeds from the IPO will be utilized for various purposes, including advertisement expenses aimed at boosting brand awareness and visibility, capital expenditure for establishing new Exclusive Brand Outlets (EBOs), the setup of new salons under its subsidiary Bhabani Blunt Hairdressing, general corporate needs, and potential inorganic acquisitions.
Honasa Consumer manages a portfolio of six brands, with Mamaearth serving as the flagship brand responsible for a significant portion of the company’s revenue. Other brands under Honasa’s umbrella include The Derma Co, Bblunt, Ayuga, Aqualogica, and Dr Sheth’s.
The Honasa Consumer IPO presents an enticing opportunity for investors to partake in the growth story of a company with a diverse portfolio of personal care brands, anchored by the success of Mamaearth.
