Firstcry IPO - Review & Fundamental Analysis

Firstcry IPO

Firstcry (Brainbees Solutions Limited) IPO consists of a fresh issue of shares worth INR 1816 crores and an offer to sell 5.43 crores of existing equity shares. The company will use the funds raised for expenses for new stores, warehouses, lease payments in India, investments in overseas expansion and subsidiaries, sales, marketing, technology, and funding for growth.

Firstcry IPO – Important Details

Firstcry IPO DateNA
Firstcry IPO Listing DateNA
Firstcry IPO PriceNA
Firstcry IPO Lot SizeNA
Firstcry IPO Total Issue SizeNA
Firstcry IPO Basis of AllotmentNA
Firstcry IPO Initiation of RefundsNA
Firstcry IPO Credit of Shares to DematNA
Firstcry IPO Issue TypeBook Built Issue IPO
Firstcry IPO Listing AtBSE, NSE

Firstcry IPO- Company Profile

Brainbees Solution Limited, commonly known as Firstcry, is India’s largest multi-channel retailing platform for Mothers’, Babies,’ and Kids’ products regarding GMV. They operate online through company-owned and franchisee modern stores and general trade retail, with a growing international presence.

FirstCry, a top platform for Mothers’, Babies,’ and Kids’ products, showcases renowned third-party and in-house brands like BabyHug. Utilizing insights, design, and market recognition, they assist D2C brands in scaling their business with a comprehensive distribution network and technology ecosystem.

FirstCry provides an integrated platform for parenting needs – shopping, community, and education. It serves customers through online channels, modern stores, retail distribution in India, and online platforms in UAE and KSA. Utilizing a content-led strategy and preschool network, it emphasizes robust data, technology, customer understanding, home brands, and third-party relationships.

Firstcry IPO – Fundamental Analysis

Firstcry’s IPO presents a company with robust revenue growth but raises concerns with escalating expenses, persistent losses, and declining financial metrics. Investors should scrutinize operational efficiency and sustainability before considering investment.

Revenue Growth: 

The company has experienced significant revenue growth, rising from ₹16,028.54 million in 2021 to ₹56,325.39 million in 2023. This robust top-line expansion suggests market demand and business scalability.

Expense Increase: 

While revenue has increased, expenses have also risen substantially, from ₹16,453.00 million in 2021 to ₹63,156.67 million in 2023. The widening gap between revenue and expenses raises concerns about cost management and overall operational efficiency.

Profitability Concerns: 

Firstcry has reported negative Profit and Loss After Tax figures, with a notable decline from ₹2,159.44 million in 2021 to a loss of ₹4,860.56 million in 2023. This suggests operational challenges and potential financial instability.

Return on Net Worth (RoNW): 

The RoNW has been negative, indicating that the company is not generating sufficient returns on its equity. Negative RoNW may raise questions about the company’s ability to create value for shareholders.

Net Asset Value (NAV) and Equity: 

The NAV per Equity Share has declined from ₹93.32 in 2021 to ₹78.10 in 2023. Despite an increase in total assets, the decline in NAV suggests potential dilution of shareholder value.

Earnings per Share (EPS): 

The Diluted EPS has turned negative, dropping from ₹5.73 in 2021 to ₹(9.97) in 2023, indicating a decline in earnings available to each share.

Total Liabilities: 

The significant increase in total liabilities from ₹5,435.31 million in 2021 to ₹29,201.35 million in 2023 may raise concerns about the company’s debt management and financial stability.

Firstcry IPO Financial Information

ParticularAs at 31 March 2021As at 31 March 2022As at 31 March 2023
Revenue (₹ in Million)16,028.5424,012.8856,325.39
Equity (₹ in Million)35,346.4042,880.4141,996.92
Expenses (₹ in Million)16,453.0025,680.6063,156.67
Profit and Loss After Tax (₹ in Million)2,159.44(786.85)(4,860.56)
RoNW (%)6.25(2.04)(12.76)
NAV per Equity Share (₹)93.3285.1278.10
Diluted EPS only (₹)5.73(1.74)(9.97)
Total Assets (in million)40,781.7161,971.6371,198.27
Total Liabilities (in million)5,435.3119,091.2229,201.35

Firstcry IPO Peer Comparison

There are no listed companies that engage in a business similar to that of Firstcry or are of comparable size to that of their Company. Accordingly, it is not possible to provide an industry comparison in relation to their Company.

Firstcry IPO Objective

The company plans to allocate funds for diverse purposes, including INR 648 crores for Indian expansion, INR 155.6 crores for international growth, INR 170.5 crores for subsidiary stake acquisition, and additional sums for sales, marketing, technology, and general corporate objectives.

  1. Expenditure for (i) setting up new modern stores, (ii) setting up a warehouse, and (iii) lease payments for their existing identified modern stores in India: The Company aims to allocate INR 648 crore for expansion in India. Of this, INR 357.2 crore is designated for new stores, INR 14.2 crore for a warehouse, and INR 276.6 crore for lease rentals, with possible additional funding sources for exceeding costs. Modern stores enhance physical product interaction; with 936 stores, they expand, merging offline and online for a seamless customer experience.
  1. Investment in their Subsidiary, FirstCry Trading, for overseas expansion by (i) setting up new modern stores in KSA and (ii) setting up warehouses in KSA: To bolster leadership in the parenting ecosystem, the Company plans to utilize INR 155.6 crores from the net proceeds for international expansion, with INR 72.6 crores allocated for new modern stores and INR 83 crore for warehouses in KSA. 
  1. Investment in their Subsidiary, Globalbees Brands, towards the acquisition of an additional stake in their indirect Subsidiaries: The Company proposes to utilize INR 170.5 crore from the Net Proceeds for investment into Globalbees Brands towards the acquisition of an additional stake in their indirect Subsidiaries, i.e., Frootle India, Plantex and Encasa Homes. 
  1. Sales and marketing initiatives: The Company plans to utilize INR 100 crore of the Net Proceeds towards funding organic growth initiatives through sales and marketing.
  1. Technology and data science costs, including cloud and server hosting-related costs: The Company intends to invest INR 57.6 crore of the Net Proceeds towards enhancing its technology and data science capabilities.
  1. Funding inorganic growth through acquisition and other strategic initiatives and general corporate purposes: The Company aims to expand globally, enhance preschool networks, acquire complementary brands, and invest in manufacturing and logistics, pursuing strategic investments, acquisitions, and partnerships for growth. The Company plans to deploy balance funds towards the general corporate goal, encompassing sales team expansion, working capital, office expansion, loan repayment, and meeting corporate exigencies.

Firstcry IPO Risks and Challenges

Firstcry IPO Risks include uncertain sustainability of historical growth, recent losses in FY 2022-2023 totaling INR (675.167) crores, and challenges in maintaining brand trust due to potential product defects, infringement claims, media issues, and regulatory concerns.

  • Firstcry’s historical performance does not indicate its future growth or financial results, and it may not be able to sustain its historical growth rates or effectively execute its strategies, which may adversely affect its business and financial results. 
  • The Company incurred losses in FY 2022, FY 2023, and Q2 2023, totaling INR (675.167) crores. Future profitability is uncertain due to factors beyond control, with anticipated rising expenses that may adversely affect financial condition and equity share value.
  • Maintaining and enhancing brand recognition is vital for FirstCry’s success. Potential issues include damage from defective products, infringement claims, adverse media coverage, and regulatory concerns, impacting customer trust and business outcomes.

Firstcry IPO – Industry & Market Potential

The rise of nuclear households in India, driven by economic factors and evolving societal norms, is expected to grow from ~197 million in 2022 to ~239 million by 2027, fostering increased consumption patterns.

The childcare products market in India is rapidly growing, ranking among the world’s largest. Despite its substantial size, per capita spending is underpenetrated compared to mature markets. Projected growth is driven by rising awareness, child health focus, increasing disposable income, and changing customer perceptions.

Multi-channel retailers in Childcare Products provide a seamless shopping experience, integrating online and offline channels. This strategy enhances brand recall, reduces acquisition costs, and meets diverse customer needs, especially in emerging community-driven platforms catering to parenting queries and networking.

Firstcry IPO – Type of Offer

Firstcry plans a fresh issue of shares, seeking INR 1816 crores to augment the capital needs of the company. Additionally, the company proposes an offer for sale, intending to sell 5.43 crore existing shares.

1.  Fresh Issue: The company will issue new shares to raise capital, aiming to collect INR 1816 crores. The company intends to utilize the proceeds for expenses for new stores, warehouses, and lease payments in India, investments in overseas expansion and subsidiaries, sales, marketing, technology, and funding for growth.

2.  Offer for sale: Firstcry is offering to sell 5.43 crore existing shares.

Firstcry IPO Offer Size

The offer size of Firstcry IPO is INR 1,816 crores, with the issuance of new shares and the sale of 5.43 crore existing shares. The funds will support expansion, warehouses, lease payments, overseas ventures, subsidiaries, and overall business growth.

Firstcry IPO Allotment Structure

Firstcry allocation will be as follows: 75% for Qualified Institutional Buyers (QIB), 15% for Non-Institutional Investors (NII), and 10% for Retail Individual Investors (RII) in accordance with SEBI regulations.

  • Qualified Institutional Buyers (QIB): As per SEBI regulations, 75% of the shares offered through the IPO will be reserved for Qualified Institutional Buyers. These include entities such as banks, mutual funds, and insurance companies.
  • Non-Institutional Investors (NII): 15% of the shares will be reserved for Non-Institutional Investors. These typically include corporate bodies or individuals investing more than Rs.2 lakhs.
  • Retail Individual Investors (RII): The remaining 10% of the shares will be allotted to Retail Individual Investors. These individual investors apply for shares with a total value of less than Rs.2 lakhs.

How to apply for a Firstcry IPO?

To apply for the Firstcry IPO through Alice Blue, you would typically follow these steps:

1. Open a Demat and Trading Account: If you don’t have one already, you would need to open a Demat and trading account with Alice Blue.

2. Check for IPO Details: Once your account is active, you can check for the Firstcry IPO details in the IPO section of the Alice Blue platform.

3. Place the Bid: Enter the number of shares you wish to buy and place your bid within the IPO’s price band.

4. Submit the Application: Confirm all your details and submit your application.

 You can apply for Firstcry Limited’s IPO at Alice Blue in just a few clicks!

Check Allotment Status: Post the allotment process, you can check the allotment status to see if you have received any shares.

Please note that the allotment of shares is not guaranteed and will depend on the demand for the IPO.

How to Check Firstcry IPO Allotment Status on Alice Blue?

Checking the allotment status of an IPO in Alice Blue is usually straightforward. Please follow these general steps:

1. Log in to your Alice Blue Account: You can do this through the Alice Blue website or their trading app.

2. Navigate to the Portfolio or IPO Section: This might differ based on the layout of Alice Blue’s platform, but generally, you can find the status of your IPO application under the ‘Portfolio’ or ‘IPO’ section.

3. Find the IPO Allotment Status: Look for a sub-section called ‘IPO Allotment Status’ or something similar. This is where you can see the status of the IPOs you have applied for.

4. Select the Firstcry IPO: If you have applied for multiple IPOs, there might be a dropdown menu or lists where you can select the IPO you are interested in. Select the Firstcry IPO.

5. Check the Status: The status of your application should be displayed here. If the shares have been allocated to you, it would be mentioned here.

 If you face any issues, it’s recommended to contact Alice Blue’s customer support for detailed assistance.

Apart from Alice Blue, there are other ways to check the allotment status of the Firstcry IPO:

Registrar’s Website: Visit the website of Link In time India Private Limited, the registrar of the Firstcry IPO. On the homepage, look for the ‘IPO Allotment Status’ option. You must enter your PAN, application, or Demat account number to check your allotment status. Click on the ‘Submit’ button to view your IPO allotment status.

NSE and BSE: You can also check the allotment status on the official websites of the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE). You would need your application number and PAN to check the status.

Please note that the allotment status will only be available after the allotment process has been completed, a few days after the IPO window closes.

Firstcry IPO Offer Registrar

The registrar for the Firstcry IPO is Link In time India Private Limited. They are responsible for ensuring the IPO allotment and refund processes are carried out smoothly.

Contact information for the registrar:

C-101, 1stFloor, 247 Park

L.B.S. Marg, Vikhroli (West)

Mumbai 400 083

Maharashtra, India

Tel: +91 810 811 4949

E-mail: [email protected]

Website: www.linkintime.co.in

Firstcry IPO FAQs

1. What is the allotment date of the Firstcry IPO?

The allotment date of Firstcry IPO has not yet been announced.

2. What is the price band of the Firstcry IPO?

The price band of the  Firstcry IPO shares issued by the company has not yet been announced.

3. What is the size of the Firstcry IPO?

 Firstcry plans to launch an Initial Public Offering (IPO). This comprises a new share issuance of INR 1816 crores and the sale of 5.43 crores of existing equity shares. The funds generated will be utilized for expenses for new stores, warehouses, and lease payments in India, investments in overseas expansion and subsidiaries, sales, marketing, technology, and funding for growth.

4. What is the listing date of the Firstcry IPO?

The listing date of the Firstcry IPO issue has not yet been announced.

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