Home Product listing MamaEarth on track for IPO by 2023

MamaEarth on track for IPO by 2023

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Mamaearth, a Gurugram-based direct-to-consumer (D2C) baby care and skincare unicorn, recently went public as part of its preparations for an initial public offering (IPO) (1). The company intends to launch its IPO in 2023 and will soon file its Draft Diverted Prospectus (DRHP).

According to the filings, the parent company of Mamaearth changed from Honasa Consumer Private Limited to Honasa Consumer Limited.

For those unfamiliar with the process, the first step towards a public listing is to change the company’s status from private to public. The next step is for the company to submit a DRHP to the Securities Exchange Board of India, which details the amount of money it intends to raise, how the funds will be used and the financial status of the company. company.

The first benefit

Mamaearth, led by the husband and wife team of Ghazal (2) and Varun Alagh (3), turned a profit in FY22, making a net profit of Rs. 19.8 Cr. It reported a net loss of Rs. 1,332.2 Cr in FY21.

Its operating revenue also more than doubled from a year earlier (YoY), reaching RS. 931 Cr, while his expenses dropped to Rs. 924.6 Cr, nearly a fifty percent decrease.

The company started selling baby care products soon after its founding in 2016, but quickly expanded into the beauty and skincare industries. When brand house D2C raised $38 million in its Series F funding round in late December 2021, the company officially became a unicorn.

Mamaearth’s investors include some of the most recognizable names in venture capital, including Sequoia India, Stellaris Ventures, Fireside Ventures, Marico’s Rishabh Mariwala, Snapdeal creators Kunal Bahl and Rohit Bansal, and actress Shilpa Shetty Kundra, among others.

It competes with beauty marketplace platforms such as Plum, WoW Skin, The Moms Co, and Biotique, as well as established companies like VLCC, Vicco, and many more.

Reports cited inside sources indicating that a potential public listing could take place as early as July 2023. However, the D2C company previously maintained its listing position on public exchanges under its three-year plan.

It may not be so easy

Mamaearth is an omnichannel retailer with operations in Southeast Asia. The company generates around 70% of its revenue through online channels, while the remaining 30% comes from physical partners.

The company’s portfolio includes several brands that it has purchased or developed in-house.

In the e-commerce sector, Mamaearth is working on initial public offering (IPO) projects. Still, a number of other e-commerce companies tied to the IPO have either dropped plans to go public or cited unfavorable market conditions.

For instance, Snapdealsubmitted its DRHP in December last year, but there is still no information regarding the company’s IPO prospects. D2C start boat flip-flopped on its aspirations to go public and opted instead to raise capital through a seed round, which may suggest the company had put plans for an IPO on hold for more than a month. an occasion.

Nykaa, a competitor of Mamaearth, is the only platform listed on the e-commerce market. Although it was successfully listed, the platform did not perform particularly well on exchanges once listed.

The foundation of MamaEarth

There is a high awareness of potentially hazardous substances in the most popular personal care products and baby care items in the United States. While Ghazal was there, she became more aware of the kinds of things she used and started inspecting the ingredient list before buying a baby item.

When Varun and Ghazal were expecting their first child, they were living in India at the time. During their pregnancy, they discovered that baby care items in India contained dangerous poisons and no safer alternative.

The husband and wife team decided to stop using products made in India and start importing reliable products made in other countries after they were unable to find baby products that could be used in India.

They then began ordering items from the United States, but this proved to be both an expensive and inconvenient arrangement for them.

Moreover, they recognized that it was not just them; in fact, there are far too many parents in India who suffer from the same problem.

This awareness helped them understand that it was not just them. However, since there were no obvious options at the time, Varun and Ghazal Alagh began researching how to make the two baby items safer and cheaper.

During this time, they have set up a research and development team and submitted applications for the corresponding certifications.

All of these things ultimately led to the formation of Mamaearth. It quickly became the first brand in Asia to offer “MADE SAFE” certified products. (4)

These products were free of toxins and packed with the natural goodness that newborns and toddlers so deserve.

In the beginning, Mamaearth was founded with around Rs. 90 lakh investment, all of which came from personal funds which Varun and Ghazal contributed.

Seed investment followed in 2016.

The MamaEarth Niche

Mamaearth is a company that focuses on babies as well as other people. It offers an exclusive product line that caters to baby care, hair care, skin care, and other areas of concern, and includes more than 80 natural products.

Mamaearth is responsible for the development of several cutting-edge products, including India’s first baby wipes made from bamboo, a stomach-friendly roll-on with asafoetida and fennel to relieve colic and digestion, and a toothpaste 100% natural herbal for children between one and ten years old.

In addition, it offers various hair and skin care products based on well-known natural components such as Onion, Ubtan, Tea Tree, Vitamin C, Argan, Cocoa, and Cocoa. charcoal.

It has expanded its reach to serve not only babies but also babies’ moms, offering a variety of items such as sunscreen and stretch mark eradication serum. It examines motherhood from every angle imaginable. Their onion flavored items for moms are hugely popular with customers.