Mamaearth parent Honasa Consumer files draft IPO papers; Shilpa Shetty, Kunal Bahl to sell stake

Honasa Consumer, the parent of Mamaearth, has filed its draft red herring prospectus (DRHP) with market regulator Sebi. The company has proposed a fresh issue of equity shares aggregating up to Rs 400 crore and an offer for sale (OFS) of up to 46,819,635 shares. The selling shareholders in the OFS would include actor Shilpa Shetty Kundra, Rohit Kumar Bansal, Sofina Ventures and Kunal Bahl, other than two promoters Varun Alagh and Ghazal Alagh.

Honasa Consumer was the largest digital-first BPC company in India in terms of revenue from operations in FY22.  It had a portfolio of six BPC brands with differentiated value propositions and as of September 30.

Honasa Consumer's flagship brand, Mamaearth, emerged as the fastest growing BPC brand in India to reach an annual revenue of Rs 1,000 crore in the preceding 12 months, within the six years of launch, its DRHP suggested.

As far as the IPO is concerned, the OFS portion would include selling of shares by promoters Varun Alagh (up to 3,186,300 shares) and Ghazal Alagh (up to 1,00,000 shares). It would also include up to 2,20,613 shares sale by Evolvence India Coinvest PCC invested through its Cell E.  Shilpa Shetty Kundra will sell up to 5,54,700 shares, Kunal Bahl up to 7,77,672 shares, Sofina up to 1,91,33,948 shares and Stellaris up to 12,755,965 shares.

The share sale would also include up to 8,62,987 equity shares by Evolvence India Fund III Ltd, up to 79,72,478 shares by Fireside Ventures Investment Fund –I, up to 4,77,300 shares by Rishabh Harsh Mariwala, up to 79,72,478 shares by Fireside Ventures Fund.

In its DRHP, the company said its focus on the BPC category coupled with our strengths in brand building, customer-centric innovation, digital-first distribution has enabled it to establish a strong presence in the BPC market in India.

Honasa Consumer intends to utilise Rs 186 crore in IPO proceeds towards advertisement expenses and enhancing the awareness and visibility of its brands. It intends to set up new EBOs and utilise Rs 34.23 crore of the IPO proceeds towards the same. Besides, it intends to invest Rs 27.51 crore towards for setting up of BBlunt salons.

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