Mamaearth founders address valuation concerns around IPO: 'We firmly stand behind this company'

Mamaearth founders Varun and Ghazal Alagh (Image credit: @GhazalAlagh/Twitter)

Following valuation concerns raised by experts ever since Honasa Consumer filed papers with capital markets regulator Sebi to raise funds through an initial public offering (IPO), founders of Mamaearth -- the company's flagship brand -- stated on Wednesday that their draft red herring prospectus (DRHP) does not mention valuation.

"Valuation discovery is a process which will take place over time as we get into deeper conversations with investor community. We have not quoted or subscribe to the valuation numbers which are getting mentioned in various posts on social media," Ghazal and Varun Alagh said in a statement.

In a note shared on social media, the couple said that they intended to throw some clarity on all the noise around valuations around their prospective IPO.

In our DRHP as is the standard practice there is no mention of valuation. Valuation discovery is a process which will take place over time as we get into deeper conversations with investor community. (2/6)

— Ghazal Alagh (@GhazalAlagh) January 4, 2023

"We have built this company and our brands with a lot of love, the same way we have raised our children. The way one never leaves the side of their children we firmly stand behind building our brands and this company for times to come," the Mamaearth founders stated.

Read more: 1000 P/E? Investors sound caution over Mamaearth IPO’s mind-boggling valuation

Recollecting that they founded the brand to provide toxin free products to babies "since we ourselves could not find the right products for our baby", Ghazal and Varun Alagh said they would keep working hard to build a business that their next generations can be proud of.

"God has been kind, luck favored us, consumers loved us and our team has put in crazy efforts to take it to a level where we are today with 6 amazing brands serving millions of Indian consumers. Even in the eye of the storm we will keep working hard, innovating and building a business that our next generations can be proud of," they stated.

Mamaearth plans to raise Rs 400 crore through a fresh issue of shares, apart from an offer for sale of about 46.8 million shares.

The company became a unicorn in January 2022, with a valuation of $1.2 billion.

Read more: Every Mamaearth product is tested by us and our children: Founders Varun and Ghazal Alagh