Also in this letter:
■ ETtech Done Deals
■ HealthKart’s FY23 report card
■ Google’s $700-million Play Store settlement
FirstCry to file IPO papers soon, looks to raise $500-600 million
Supam Maheshwari, CEO, FirstCry
SoftBank-backed FirstCry is looking to file its draft IPO papers in the next few days, sources told ET. This comes after the omnichannel retailer had delayed its listing plans last year due to choppy market conditions. The company is aiming to raise $500-600 million through the public offer.
Dalal Street plans: “The draft red herring prospectus (DRHP) is likely to be filed with the markets regulator Sebi before December 29. The listing is expected to take place after the April-May general elections next year,” said a person familiar with the matter.
While the valuation has not been finalised, it may be pegged at around $4 billion during the IPO, sources told ET. It was last valued at just under $3 billion.
Second IPO after Nykaa: FirstCry will be the second Indian vertical ecommerce platform to go public after Nykaa’s IPO in 2021. However, FirstCry has to keep its foreign shareholding below 51%, in line with the country’s FDI laws for ecommerce.
SoftBank, which is the company’s single largest investor, has been looking to dilute its stake to under 26%, so that it doesn’t get classified as a promoter.
Family offices aboard: In August, three family investment offices — Ranjan Pai’s (Manipal Group) MEMG Family Office, Harsh Mariwala’s (Marico) investment office Sharrp Ventures, and Hemendra Kothari’s DSP family office — had picked up stakes in FirstCry for about Rs 435 crore. They did so by largely buying stakes from SoftBank.
IPO details: 35-37% of the total issue will be in primary share sale with the rest being an offer for sale, another person aware of the matter said. In an offer for sale process, existing shareholders will sell their stake in part to new investors.
Another IPO: ET reported on December 12 that electric scooter maker Ola Electric is set to file its DRHP with the market regulator as it plans for an IPO. The firm expects to list by the end of fiscal year 2024 and is looking to raise between $700 million and $800 million (Rs 5,836.3 crore and Rs 6,670.1 crore) at a valuation between $7 billion and $8 billion valuation (Rs 58,363 crore and Rs 66,701 crore).
Expansion underway: FirstCry has been working on scaling up its omnichannel operations. It is close to hitting 1,000 physical stores soon, from 900 recently, and is looking to expand to about 3,000 stores in the next few years.
BharatPe to raise Rs 500 crore debt over the next year
Fintech startup BharatPe is looking to raise Rs 500 crore of debt through unlisted non-convertible debentures (NCDs), sources told ET. While the final pricing is yet to be decided, the funds will be raised over multiple tranches through the next year. The fundraise proposal was approved last week by the directors in a board meeting.
Board appointments: The company approved the appointment of Colin Bryant, chief operating officer of private equity and general partner at US-based hedge fund Coatue, to its board. Bryant will replace Coatue’s previous nominee, Rahul Kishore, who left the hedge fund in November. Further, general counsel Sumeet Singh has also been elevated to whole-time director. He was appointed as additional executive director earlier in February this year.
Previous debt: In the past, BharatPe has raised debt from the likes of IIFL Wealth and Northern Arc Capital. It had raised total debt of over Rs 500 crore in 2021 and had plans to borrow Rs 5,823 crore ($700 million) in line with its aspirations to create a loan book of over Rs 8,000 crore ($1 billion) by March 2023.
Equity funding stuck: ET reported in September that the Peak XV Partners-backed startup had held talks with investors for a fresh $100 million equity funding round. But the deal has not materialised yet, with conversations getting stuck over the valuation at which the deal can take place. In 2021, BharatPe had raised its last equity round at a valuation of around $2.9 billion.
ETtech Done Deals
(L-R) Sheshgiri Kamath and Vikas Garg, cofounders, Kapture CX
SaaS startup Kapture secures $4 million funding: Kapture CX, a customer support platform for enterprises, has raised $4 million from India Alternatives, a private equity fund. The latest infusion will be used to push Kapture’s generative artificial intelligence (Gen AI) capabilities and strengthen its footprint across India as well as global markets.
Battery recycling startup BatX raises $5 million: Lithium battery recycling startup BatX Energies has raised $5 million in funding from Zephyr Peacock and Lets Venture. The funds will be used for market expansion and to scale up recycling operations across the country.
Drug discovery startup Peptris bags $1 million funding: Peptris Technologies, a Bengaluru-based artificial intelligence-powered drug discovery company, has raised $1 million in a pre-seed funding round led by Speciale Invest.
Prop-tech startup HouseEazy raises $1 million: HouseEazy, a vertical marketplace for resale homes, has raised $1 million in seed funding led by Antler. Other leading investors in the round include India Accelerator, AC Ventures, Agility Ventures, Finvolve Ventures and industry veterans, including Pirojsha Godrej, executive chairperson at Godrej Properties and Sandeep Aggarwal, founder of Droom.
Also read | Nila Spaces launches proptech accelerator programme
HealthKart revenue grows 69% in FY23
Sameer Maheshwari, founder & CEO, HealthKart
Omnichannel nutrition products retailer HealthKart reported a 69.5% year-on-year rise in operating revenue to Rs 832.48 crore during the fiscal year ended March 31.
Key financial numbers:
- HealthKart’s net loss nearly halved to Rs 164.71 crore during the fiscal year ended March 31
- The Gurugram-based company’s total expenses grew only 21.5% during the year to Rs 1,016.5 crore
- The biggest chunk of expenses came from raw material costs, which increased to Rs 341.6 crore in FY23 vs Rs 197.4 crore a year ago
Funding details: In December last year, HealthKart raised $135 million (around Rs 1,100 crore) in its Series H funding round, led by Singapore’s sovereign fund Temasek. Mumbai-based A91 Partners and Kae Capital also participated in the round.
The company had raised $25 million in its Series G round in May 2019 from investment firm Sofina.
Know the company: HealthKart assumed its current avatar in 2015 after the original brand HealthKart Plus saw its pharmaceuticals segment being hived off into 1mg, currently backed by the Tata Group.
It has around 250 physical stores now, up from 140 stores last year. It also sells its products through its online channel and third-party ecommerce marketplaces such as Amazon and Flipkart.
Google to pay $700 million to US consumers, states in Play Store settlement
Alphabet-owned Google will cough up $700 million and allow for greater competition in its Play app store to settle an antitrust settlement with US states and consumers.
Details: Google will pay $630 million into a settlement fund for consumers and $70 million into a fund that will be used by states, the company said in a statement.
The tech giant will also allow developers on its Play app store to offer direct payment options to users.
The allegations: Google was accused of overcharging consumers through unlawful restrictions on the distribution of apps on Android devices and unnecessary fees for in-app transactions. Google charges app makers a 15% fee for customer payments for app subscriptions and up to 30% for purchases made within popular apps that are downloaded from the store.
A California federal jury last week agreed with Epic that parts of Google’s app business were anticompetitive.
Also read | Epic wins antitrust fight vs Google: A deeper look at the case and its implications
Catch up quick: In October 2022, the Competition Commission of India (CCI) levied a penalty of Rs 936.44 crore on Google for abusing its dominant position in its Play Store policies. Earlier, the watchdog had imposed a Rs 1,337.76 crore penalty on Google for abusing its dominant position in the Android devices market.
Following the two CCI orders, the tech giant tweaked its Play Store policies and rolled out its new in-app user choice billing (UCB) policy. However, an alliance of startups later moved court alleging that Google’s UCB was in gross violation of CCI directives.
Today’s ETtech Top 5 newsletter was curated by Gaurab Dasgupta in New Delhi and Megha Mishra in Mumbai.
