Mamaearth raises Rs 765 crore from anchor investors ahead of IPO

Varun and Ghazal Alagh, co-founders of Mamaearth

Gurugram-based beauty and personal care company Honasa Consumer has mopped up Rs 765.2 crore from 49 anchor investors on October 30, the day before issue opening.

The parent firm of Mamaearth has attracted great interest from investors as marquee names like Smallcap World Fund Inc, Fidelity Funds, Abu Dhabi Investment Authority, Government Pension Fund Global, Caisee De Depot ET Placement, FSSA India Suncontinent Fund, Carmignac Portfolio, Goldman Sachs, Fundpartner Solutions, and Hornbill Orchid India Fund invested in the company via anchor book.

Honasa Consumer in its filing to exchanges said it has finalised allocation of allocation of 2,36,17,228 equity shares to anchor investors at Rs 324 per share.

Mutual Fund houses like ICICI Prudential Mutual Fund, Aditya Birla Sun Life Trustee, Nippon Life India, Axis Mutual Fund, Whiteoak Capital MF, Invesco, Kotak Funds, and Franklin Templeton Investment Funds also participated in the book.

"Seven domestic mutual funds have applied in the anchor book, through a total of 19 schemes," the company said.

Insurance majors namely SBI Life Insurance Company, Aditya Birla Sun Life Insurance Company, ICICI Prudential Life Insurance Company, Max Life Insurance Company, Bajaj Allianz Life Insurance Company, and Bharti Axa Life Insurance Company also invested in the Varun Alagh and his wife Ghazal Alagh promoted company.

D2C brand Mamaearth parent Honasa Consumer will open its Rs 1,701-crore initial public offering on October 31, with a price band of Rs 308-324 per share.

The offer consists of a fresh issuance of shares worth Rs 365 crore, and an offer-for-sale (OFS) of 4.13 crore equity shares by promoters and investors.

The company had trimmed its IPO size by 10 percent and had lowered its valuation expectations, as reported earlier. 

Honasa operates several consumer brands including Mamaearth, The Derma Co., Aqualogica, Dr Sheth's, Ayuga, and BBLUNT, will utilise net fresh issue proceeds for Rs 182 crore for the advertisement expenses towards enhancing the awareness and visibility of the brands, and Rs 20.6 crore for setting up new exclusive brand outlets (EBOs).

Further, it will invest Rs 26 crore in its subsidiary, BBlunt for setting up new salons, and the remaining part of the issue proceeds will be used for general corporate purposes and unidentified inorganic acquisition.

Promoters including Varun Alagh and Ghazal Alagh hold 37.41 percent stake in Honasa, and the rest of shareholding is owned by public including Peak XV Partners, Fireside Ventures Fund, Stellaris and Sofina.