FirstCry IPO sees 30% subscription on second day of bidding, retail portion fully booked

Employees looked aggressive in bidding as they bid 3.17 times the reserved portion.

Brainbees Solutions' initial public offering continued to receive muted response from investors even on the second day of bidding, i.e. August 7. The issue has garnered bids for 1.47 crore equity shares, which is 30 percent of the total offer size of 4.96 crore equity shares, the subscription data published on the exchanges showed.

The FirstCry operator launched its maiden public issue on August 6 to raise Rs 4,193.7 crore at the upper end of price band of Rs 440-465 per share. The IPO is a mix of fresh issuance of shares worth Rs 1,666 crore, and an offer-for-sale of 5.4 crore shares worth Rs 2,527.7 crore by the existing shareholders.

Retail investors were the leaders, picking 1.06 times the allotted quota, while the response from non-institutional bidders and qualified institutional buyers remained lukewarm as they bought 0.30 times and 0.03 times the portions set aside for them.

Employees looked aggressive in bidding as they bid 3.44 times the reserved portion. The company has set aside Rs 3 crore worth shares for its employees and the said shares will be allotted at a discount of Rs 44 per share to the final issue price.

Also read: Saraswati Saree Depot sets IPO price band at Rs 152-160 per share

Brainbees, which operates FirstCry, the multi-channel retailing platform for mothers, babies and kids products, has already mobilised Rs 1,886 crore on August 5 from several anchor investors including Singapore government, Abu Dhabi Investment Authority, Monetary Authority of Singapore, Goldman Sachs, Carmignac Portfolio, Nomura Funds, Societe Generale, Citigroup Global, SBI Mutual Fund, ICICI Prudential Mutual Fund, HDFC Mutual Fund, and Kotak Mutual Fund.

The Pune-based company will spend Rs 108.1 crore for setting up new modern stores under the BabyHug brand, and a warehouse in India. Furthermore, Rs 93.1 crore will be spent for lease payments for existing identified modern stores owned and operated by the company in India, and Rs 299.6 crore for investment in subsidiary, Digital Age.

In addition, Rs 155.6 crore will be utilised for investment in subsidiary FirstCry Trading for overseas expansion, Rs 169 crore for investment in subsidiary Globalbees Brands towards acquisition of additional stake in step-down subsidiaries, and Rs 200 crore for sales and marketing initiatives. Further, it will spend Rs 57.6 crore for technology and data science cost including cloud and server hosting related costs; and the remainder money for inorganic growth and general corporate purposes.

Brainbees remained a loss making company, recording a net loss at Rs 321.5 crore for the fiscal 2024, narrowing from a loss of Rs 486 crore in the previous fiscal. Revenue during the financial year gone by stood at Rs 6,480.86 crore, growing 15 percent from Rs 5,632.54 crore in previous year.

The FirstCry public issue will close on August 8.