Firstcry IPO Listed at ₹465, Above Issue Price

Brainbees Solutions Limited, the parent company of Firstcry, made a notable debut on the stock market with its IPO. The company listed at ₹465 per share, opening at a premium that reflected the strong demand and confidence in its business model, which focuses on baby and kids' products.

The IPO was heavily subscribed, with a total subscription rate of 12.22 times. The breakdown is as follows: Qualified Institutional Buyers (QIBs) subscribed 19.30 times, Non-Institutional Investors (NIIs) 4.68 times, and Retail Investors 2.31 times. The strong demand from QIBs, who were allotted 27,036,953 shares, underscores the market’s belief in Brainbees Solutions’ long-term growth prospects.

The IPO comprised a mix of fresh equity shares and an offer-for-sale (OFS), with the total issue size being ₹4,193.73 crore. The fresh issue portion, amounting to ₹1,666.00 crore, is earmarked for purposes including establishing new modern stores under the "BabyHug" brand, setting up warehouses in India and abroad, and other general corporate purposes. The company also plans to use part of the proceeds to invest in its subsidiaries and finance various strategic initiatives.

Brainbees Solutions Limited was established in 2010 and sells items on its FirstCry website for moms, babies, and children. Brainbees Solutions (FirstCry) aims to establish a one-stop shop for parents' education, community involvement, retail, and content requirements. The company provides everything a baby needs from birth to age twelve, including clothing, shoes, baby equipment, a nursery, toys, diapers, and personal hygiene products. 

The company sells goods under its labels and international and Indian third-party brands. With over 1.5 million SKUs from over 7,500 brands on its multichannel platform, the company delivers a range of products for mothers and kids in categories such as clothing and accessories, toys, books, school supplies, diapers, bath and skincare, nutrition and breastfeeding, etc. (as of December).

The financials for the fiscal year ending March 2024 show a revenue of ₹6,575.08 crore, a significant increase from ₹5,731.28 crore in the previous year. However, the company has posted a loss, with a Profit After Tax (PAT) of ₹-321.51 crore, which, although still negative, is an improvement from the previous year's loss of ₹-486.06 crore. Despite these losses, the IPO was well-received due to the company’s strong brand presence and growth potential in the e-commerce sector.

FirstCry IPO Subscription Status

Analysts view Brainbees Solutions Limited as a solid long-term investment, primarily due to its leadership in the niche market of baby and kids' products and its expansive operational footprint. However, there may be short-term price volatility, given the high subscription rates and the company's current financial losses. Investors should consider the company's long-term growth potential when making investment decisions.

To Summarise

Brainbees Solutions Limited made a significant entry into the market with its IPO, priced at around ₹465 per share. The IPO was subscribed 12.22 times overall, with strong interest from institutional investors. The funds raised will be used for company expansion, working capital, and general corporate purposes. Despite current financial losses, the company's strong market position and growth potential make it a compelling investment for the long term.