FirstCry and Unicommerce Receive SEBI Approval for IPOs

FirstCry and Unicommerce, both backed by SoftBank, have received final approval from the Securities and Exchange Board of India (SEBI) for their initial public offerings (IPOs). This significant milestone marks a major step for both companies as they prepare to go public and expand their market presence.

FirstCry’s IPO Details

FirstCry, a prominent omnichannel retailer focusing on baby and kids’ products, plans to raise Rs 1,816 crore through a fresh issue of equity shares. Additionally, the IPO includes an offer for sale (OFS) of up to 54.4 million shares by existing shareholders. Notable stakeholders such as SoftBank, TPG, and PremjiInvest are expected to divest their stakes as part of this offering. FirstCry had to refile its draft red herring prospectus (DRHP) earlier this year after SEBI raised concerns about the financial metrics disclosed in its initial application. The refiled DRHP now provides comprehensive financials, showcasing a revenue from operations of Rs 4,814 crore and a net loss of Rs 278 crore for the nine months ending December 31, 2023.

This move is anticipated to enhance FirstCry’s ability to invest in new technologies, expand its product range, and penetrate deeper into the Indian market. Employee retention and recruitment are also expected to benefit from this infusion of capital, as the company looks to maintain its leadership in the baby products sector.

Unicommerce’s Strategic IPO

Unicommerce, an e-commerce SaaS platform also backed by SoftBank, will pursue an IPO consisting solely of an OFS of up to 29.84 million shares. This offering will not include any fresh issue of shares. The primary stakeholders, including SoftBank and B2 Capital, plan to offload significant portions of their holdings. The approval from SEBI follows a successful pre-IPO transaction in December 2023, which valued Unicommerce at approximately Rs 665 crore.

The proceeds from the IPO are expected to provide liquidity for existing investors and support Unicommerce’s growth strategy, enabling the company to invest further in technology and product development. This strategic move is likely to solidify Unicommerce’s position in the competitive SaaS market, particularly within the e-commerce segment.

Broader Market Implications

The approvals for FirstCry and Unicommerce come amidst a robust demand for IPOs in India. This trend highlights a favorable market environment, encouraging several other venture capital and private equity-backed companies to consider public listings. Companies like Ola Electric, Ixigo, and Digit Insurance are also in various stages of preparing for their IPOs. The successful listing of FirstCry and Unicommerce is expected to boost investor confidence and potentially pave the way for more tech startups to explore public offerings.

These developments underscore the dynamic nature of the Indian startup ecosystem, where substantial capital inflows and regulatory approvals are creating an enabling environment for growth and innovation. As these companies transition to public ownership, they are expected to drive significant changes in their respective industries, setting benchmarks for operational excellence and financial transparency.

Financial Performance and Future Outlook

Both FirstCry and Unicommerce have demonstrated strong growth trajectories, supported by substantial investments from prominent global investors. For FirstCry, the public offering represents an opportunity to scale operations, enhance its product offerings, and strengthen its market position. Similarly, Unicommerce’s IPO will provide the necessary capital for technological advancements and market expansion.

As these companies move towards their IPOs, their strategic initiatives and financial health will be closely monitored by investors and market analysts. The successful execution of these IPOs is expected to not only provide significant returns to existing investors but also set a precedent for other startups aiming to go public.

References & Further Reading

• entrackr.com. (2024, July 1). Retrieved from SoftBank-backed FirstCry, Unicommerce get SEBI approval for IPO
• vccircle.com. (2024, July 1). Retrieved from SoftBank-backed FirstCry, Unicommerce get SEBI nod for IPOs
• livemint.com. (2024, July 1). Retrieved from FirstCry IPO: Brainbees Solutions receives Sebi approval for its public issue