FirstCry DRHP: Here's how unicorn intends to use ₹1816 crore IPO capital

FirstCry IPO: The company will sell up to 54.4 million shares worth ₹1,816 crore through the initial public offering (IPO) route.

Brainbees Solutions, the parent company of retailer FirstCry, has filed the draft red herring prospectus (DRHP) with India's market regulator, Sebi. The company will sell up to 54.4 million shares worth ₹1,816 crore through the initial public offering (IPO) route.

A FirstCry store

Here are some salient points of the draft documents.

1. The Pune-based company will use the raised capital to set up new retail stores, warehouses and international expansion. SoftBank Vision Fund, Premji Invest and Mahindra Retail will offload their holdings via the IPO.
2. The company intends to use ₹648 crore for the setting up of modern stores and warehouses and make lease payments for existing stores, reported Inc42.
3. The unicorn will invest ₹155.6 crore in its foreign subsidiary for overseas expansion. It will set up modern stores in Saudi Arabia.
4. The company will invest ₹170.5 crore to acquire additional stake in Globalbees' indirect subsidiaries. FirstCry will also invest ₹100 crore in investment for sales and marketing initiatives, ₹57.6 crore in technology and data science.
5. The rest of the money, according to the document, will be used to fund inorganic growth and other corporate purposes
6. The valuation of FirstCry was 3 billion dollars in April. With a 25.5 percent stake, SoftBank is the biggest shareholder in FirstCry.
7. Existing investors, including tech-to-tractors firm Mahindra And Mahindra and U.S. private equity fund TPG, will sell up to 54.4 million shares, the IPO papers showed.
8. The company didn't reveal how many stores it will open in Saudi Arabia.
9. According to the document, Mahindra will sell its 0.58 percent stake in the parent company; SoftBank will offload 2.03 crore shares.
10. FirstCry has reported a six fold jump in its net loss for this fiscal at ₹486 crore. The net loss is 515 per cent more than than FY22 figure of ₹79 crore, Livemint reported. The firm witnessed its revenue from operations in FY22 surge by 135 per cent from ₹2,401 crore to ₹5,633 crore.