IPO-bound Mamaearth to raise $150mn from QIA, SoftBank & others, says report

Mamaearth, a personal care brand, is reportedly preparing to secure between $120 million and $150 million in a fresh funding round before its imminent initial public offering (IPO), as indicated by a recent report.

Mamaearth's parent company, Honasa Consumer Private Limited, received approval from India's Securities and Exchange Board for its IPO earlier this month. Having delayed its IPO in March due to unfavorable market conditions, Honasa Consumer is reportedly in discussions with potential investors, including SoftBank, Singapore's GIC, Qatar Investment Authority (QIA), and pre-IPO backers like Fidelity Investments, to raise approximately $1.5 billion for the IPO.

The funding round will likely involve a secondary share sale, as Mamaearth, a profitable venture, doesn't require primary capital infusion at present. While the founders are confident about the IPO exit, some early investors are looking to sell shares prior to the offering.

Mamaearth, encompassing brands like The Derma Co and BBlunt, was valued at $1.2 billion during a funding round in January 2022. If SoftBank invests, it will mark their first India investment in over 15 months.

Mamaearth's draft prospectus proposed both a fresh equity share issue and an offer for sale, while the shareholders planning to dilute their holdings via the IPO include the founders, Sofina Ventures SA, Evolvence, Fireside Ventures, Stellaris Venture Partners, Kunal Bahl, Shilpa Shetty Kundra, and others.

In April-September 2022, Honasa Consumer reported operational revenue of Rs 722.73 crore with a profit of Rs 3.67 crore, compared to operational revenue of Rs 943.46 crore and a net profit of Rs 14.43 crore for the year ending March 31, 2022.