FSN E-Commerce Ventures Limited, which owns online cosmetic brand Nykaa, will launch its initial public offering (IPO) on October 28. According to media reports, an anchor placement of up to Rs 2,340 crore will open on October 27 and the IPO will close for subscription on November 1.
The company seeks a valuation of around $7.4 billion in the IPO and aims to raise as much as Rs 5,200 crore. The proceeds will be used by the company to repay debt and to market its products.
The IPO is likely to include a primary issue of stock worth Rs 630 crore. Going by the company’s draft red herring prospectus (DRHP) approved by SEBI on October 14, a total of 41.97 million shares would be available through offer-for-sale (OFS).
Currently, company founder Falguni Nayar and her family hold more than 53 percent stake in FSN. She is expected to continue being the largest shareholder even after the IPO.
Meanwhile, several other investors of the company are looking to offload their stakes in the upcoming IPO. These include — TPG, Light House India Fund, JM Financial, Yogesh Agencies, Sunil Kant Munjal, Harindarpal Singh Banga, Narotam Sekhsaria, and Mala Gaonkar. In addition, company promoter Sanjay Nayar Family Trust will also sell 4.8 million shares.
Kotak Mahindra Capital, Bofa Securities, Citi, JM Financial, Morgan Stanley, and ICICI Securities are the investment bankers working on the IPO.
Founded in 2012, Nykaa offers a diverse portfolio of beauty, personal care, and fashion products to its customers. The company recorded a net profit of Rs 61.96 crore in FY 2020-21 and its revenue grew 38 percent year-on-year to Rs 2,453 crore. As of March 2021, the online beauty store had cumulative downloads of 43.7 million across all mobile applications.
