FirstCry, which had to withdraw papers for its $500-million IPO last week, is likely to refile an updated set of draft IPO papers by midnight (April 30) with additional key performance indicators (KPIs) and December financials, people aware of the developments told Moneycontrol.
Moneycontrol had previously reported that Pune-based FirstCry was preparing to refile its IPO papers in the coming days after the markets regulator, the Securities and Exchange Board of India (SEBI), had sent back its filings the first time.
SEBI and FirstCry were engaging for over a month before the regulator finally sent back the company's filings and sought more clarity last week.
SEBI had initially sought 25 KPIs of which FirstCry provided only 5-6 in its first set of filings, sources told Moneycontrol earlier. FirstCry's KPIs include its average order value, annual transacting customers and number of orders. Along with a more elaborate set of KPIs, SEBI asked for an updated set of financials.
Back in December 2023, when FirstCry first filed its draft IPO papers, it had provided its financial statements until September 2023 but the refiling, which is likely to happen in the coming hours, will be updated to reflect the company's performance until December 2023, sources privy to the developments told Moneycontrol.
FirstCry did not respond to Moneycontrol's queries.
The updates mean that FirstCry's listing is delayed by a few months and is now expected only in July-August.
This comes at a time when SEBI has stepped up scrutiny of new-age internet companies after firms like Paytm and others failed to deliver returns to retail investors in the past when the hit the public markets.
SEBI introduced this rule in 2022, heightening scrutiny of companies looking to list, after wide-spread criticism on the seemingly lax oversight over large loss-making companies which have commanded lofty valuations.
Another source told Moneycontrol that SEBI is taking a closer look at companies that are not promoter led and FirstCry happens to fall in that category.
Founder offloads shares
In January this year, Moneycontrol reported that Supam Maheshwari, founder and managing director of FirstCry offloaded 6.2 million shares in the company in the 10 days prior to filing for an IPO. At Rs 487.44 each, the highest price at which a secondary share sale was executed in December, Maheshwari's offloaded shareholding would be worth more than Rs 300 crore.
Maheshwari earlier held 7.46 percent stake in the company and after the transactions, his holding reduced to 5.95 percent.
The DRHP had also shown that Maheshwari has sold 9.34 million shares during six months before the date of filing of the DRHP. At the price of Rs 487.44 apiece, this share transfer would be worth over Rs 455 crore.
The founder group and SoftBank had sold shares to incoming investors at a valuation of Rs 23,000 crore (around $2.8 billion). FirstCry is however expected to price its IPO at a valuation of $3.5-3.75 billion.
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