SoftBank-Backed Companies Gear Up for Public Listings

The Indian stock market is witnessing a surge in activity from internet-based companies seeking public listings. In a recent development, the Securities and Exchange Board of India (SEBI) granted final approval for the initial public offerings (IPOs) of two SoftBank-backed ventures – FirstCry and Unicommerce.

FirstCry Refines IPO Plans to Address SEBI Concerns

FirstCry, a leading omnichannel retailer catering to the needs of children, had initially filed its draft red herring prospectus (DRHP) in December 2023. However, SEBI raised concerns regarding the limited financial information provided, encompassing only the first quarter of FY24. Consequently, the company had to refile its DRHP in April 2024 with more comprehensive data.

The revised draft prospectus reveals FirstCry’s revenue from operations to be Rs 4,814 crore for the first three quarters of FY24 (Q1-Q3 combined). While achieving strong sales figures, the company also reported net losses of Rs 278 crore during the same period.

FirstCry’s IPO Structure

FirstCry’s public offering will consist of two components: a fresh issue of equity shares worth up to Rs 1,816 crore and an offer for sale (OFS) of up to 54,391,592 existing equity shares.

Unicommerce Opts for Offer for Sale Route

Unicommerce, an e-commerce focused SaaS (Software as a Service) startup, also received SEBI approval for its IPO. Unlike FirstCry, Unicommerce will not be issuing new shares. Their offering will solely comprise an OFS of up to 2,98,40,486 existing equity shares.

SEBI Approves a Flurry of SoftBank-Backed IPOs

This latest development marks the third SEBI approval for a SoftBank-backed company in recent weeks. Last month, Ola Electric, another prominent player in the Indian startup ecosystem, received the green light for its IPO aiming to raise Rs 5,500 crore ($660 million).

A Thriving IPO Landscape in India

2024 has witnessed a significant rise in internet companies entering the Indian stock market. Several companies have already successfully listed their shares, including TBO Tech, Digit Insurance, Awfis, and Ixigo. Others like Mobikwik, Swiggy, and Avanse are awaiting SEBI’s approval.

Beyond Listed Startups: The Queue for Public Offerings Lengthens

The trend extends beyond established companies. Promising startups in sectors like logistics (Blackbuck), online meat retail (Zappfresh), and electric vehicle manufacturing (Ather) have recently converted into public entities, paving the way for potential IPOs in the near future. This surge in public listings reflects the growing maturity and investor confidence in the Indian internet sector.