On 28th October, Mumbai-based FSN E-Commerce Ventures, Nykaa’s parent company is planning to launch its Initial Public Offering (IPO) in order to raise Rs. 5352 Crores. After Zomato, which drew humongous interest for its innovative IPO in July. Nykaa will be the second startup to go public this year Paytm, PolicyBazaar, and Mobikwik is also waiting in line.
Nykaa IPO: Decoded
Here is everything you need to know about the Nykaa IPO:
- Rs. 2340 crore of anchor placement will be open on 27th October (Wednesday), and the IPO will be closed on Monday (1 November),
- It will be a mix of new stocks and an offer for sale a price band of Rs.1085-1125 apiece in order to raise the maximum amount of Rs. 5352 Crore will be issued at the valuation of $7.1 billion,
- The primary issue is worth as much as Rs. 680 Crore. The OFS ( Offer For Sale ) might see the existing shareholder offloading 41.97 million shares according to the Draft Red Herring Prospectus (DRHP) sanctioned by SEBI ( Securities and Exchange Board of India ),
- TPG, Light House India Fund, JM Financial, Yogesh Agencies, Sunil Kant Munjal, Harindarpal Singh Banga, Narotam Sekhsaria, and Mala Gaonkar are amongst the shareholders who will likely sell their stakes,
- Sanjay Nayar Family Trust will also sell its 4.8 million shares,
- Founder Falguni Nayar and Family currently holds the majority of stakes in the FSN E-Commerce Venture. They will continue to have the majority of stakes even after the IPO launch.
- Nykaa is one of the most profitable etailers in India. Nykaa reported a net profit of Rs.61.96 Crore in this fiscal year compared to its loss of Rs.16.34 Crore the previous year.
- The revenue growth of the company was Rs. 2453 Crore that is 38% in FY21. The company had earlier mentioned that they would pay Rs.130 Crore from the IPO proceeds to repay its debts and Rs. 200 Crore to its market brands.
First-Women Led Unicorn Startup to Launch IPO
Nykaa will not only be the first women lead India unicorn to launch its IPO. However, Falguni Nayar the founder of Nykaa is expected to be a strong holder in the brand. Falguni Nayasr’s profitable venture is going public. She is the first women owner of the unicorn to take her IPO in public. She has more than half the stakes of the FSN E-Commerce Venture. Even after the IPO, she will continue having the same that will ensure a higher grip over the company and also for better management.
Falguni with her husband Sanjay and 2 children have the 53% in Nykaa. The major stakes were owned by two trusts- Falguni Nayar Family Trust and Sanjay Nayar Family Trust. “For a majority stakeholder, these broad rights can be accorded as per the laws. However, she is the only founder among the top-tier founders to have such a stake in the firm going into the IPO” a senior industry executive who has worked with IPO regulations said.