Urban Company files draft papers for Rs 1,900 crore IPO, plans tech expansion and scale-up

Urban Company Ltd., a leading home services provider, took a major step toward its market debut by filing draft papers for an initial public offering worth up to Rs 1,900 crore on April 28. The offer will blend a fresh share issue with a stake sale by existing investors, setting the stage for one of the year’s most anticipated listings.

According to DRHP filed with SEBI, the technology platform, backed by investors such as Elevation, Accel and Prosus, plans to raise up to Rs 429 crore through a primary share issuance. This is notably lower than the Rs 528-crore fresh issue previously approved by shareholders.

Urban Company may also explore a pre-IPO placement of up to Rs 86 crore, which would proportionately reduce the size of the fresh issue.

Currently operating across 59 cities in India, the UAE and Saudi Arabia. Urban Company is also supported by Bessemer Venture Partners. It joins a growing roster of Indian startups eyeing the public markets, including Physics Wallah, PhonePe and Flipkart.

The proceeds from the offering are slated for developing new technology and cloud infrastructure. Additionally, a portion will go towards marketing initiatives and office overheads.

In the financial year ended March 2024, the Delhi-NCR-based firm reported revenue of Rs 828 crore, marking a 30% rise from Rs 636.5 crore in FY23. Over the same period, it narrowed its net loss to Rs 92 crore, a significant improvement from Rs 312.4 crore a year earlier. Urban Company has not yet disclosed its financials for FY25.

Kotak Mahindra Capital, Morgan Stanley India, Goldman Sachs, and JM Financial are acting as the lead bookrunning managers for the IPO.

Founded nearly a decade ago by Abhiraj Bhal, Raghav Chandra, and Varun Khaitan, Urban Company last secured primary funding in 2021 from investors including Tiger Global Management, Dragoneer, Steadview, and Prosus. The company was valued at $2.6 billion at the time.