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FirstCry May Witness Stake Sale By SoftBank, NewQuest; To Launch IPO In Few Months

Domestic e-commerce company FirstCry, which is going to launch its initial public offering (IPO) in the next few months, may witness its existing investors, Masayoshi Son-led SoftBank and NewQuest Capital Partners, sell their stakes, according to a media report. It will value the baby products retailer at $3.5-4 billion.

Japan’s SoftBank is the biggest investor in FirstCry with a 29 per cent stake and seeks to cut its holding to less than 25 per cent, according to the ET report quoting sources.

The Pune-based company, FirstCry, is already looking to decrease its foreign ownership and increase domestic private equity funding as the company is going to file papers for its IPO in the next few months. The first is in talks with Mumbai-based private equity firm Kedaara Capital for funding in the secondary round.

According to the ET report, the company aims to launch IPO at a valuation of $6-7 billion as it is a profitable e-commerce company, which is rare. In the financial year 2020-21, FirstCry posted a net profit of Rs 216 crore, compared with a loss of Rs 191 crore in the previous year.

FirstCry earlier planned to launch its IPO in May this year but it was postponed as the market condition was not conducive. The company also has offline stores. Earlier, it was aiming for a valuation of about $7 billion for an issue size of $1 billion with an offer for sale (OFS) component of around $700 million, the report said.

Pune-based Supam Maheshwari and Amitava Saha established FirstCry in 2010. The company has 7.5 million registered users, 5,800 brands, more than two lakh unique products (toys, footwear, clothing, toiletries and accessories), and over 400 storefronts across India, according to its website. It has a presence in the UAE as well. The company paid Rs 362 crore in cash and shares for the babycare company BabyOye in 2016, which was a subsidiary of Mahindra & Mahindra.

FirstCry sells products of all leading brands for babies and kids across sections right from diapers, baby food, infant accessories, gears (strollers, high chairs), nursery furniture, clothes & footwear to toys and school products. It also stocks items from some of the leading importers and domestic manufacturers of the country, according to the company website.