ADIA, Norges among anchor backers in Mamaearth’s $92M raise ahead of IPO

Honasa Consumer, the parent firm of skin and personal care brand Mamaearth, has raised about $92 million in an anchor round ahead of its initial public offering starting Tuesday in a major boost to the Indian startup that in many ways is testing the current appetite of the local public markets.

A group of over three dozen asset managers including Abu Dhabi Investment Authority, Fidelity, Norges Bank, Invesco, Goldman Sachs, CDPQ, White Oak, Franklin Templeton, Kotak, DSP, Carmigniac Gestion, Loomis Sayles, Matthews, Pictet and Hornbill were issued the shares via anchor book, Honasa said late Monday in an exchange filing.

The investors, which included many Indian mutual funds, have subscribed nearly half of the $204.3 million that Mamaearth, which manufactures and sells a range of skincare products, is hoping to secure in the public markets debut.

Mamaearth, which counts Peak XV Partners and Sofina among its backers, will open its initial public offering on Tuesday at a price band of $3.7 to $3.9.

Honasa houses about half a dozen brands including Mamaearth, The Derma Co. and BBlunt, among others. It operates through a robust omni-channel distribution network. Online, as one of India’s predominant digital-first BPC firms, Mamaearth services about 18,000 ZIP codes via its D2C and e-commerce channels. Offline, it has significantly expanded its reach in around 113,000 FMCG retail outlets nationwide.

About a dozen other Indian startups are keenly monitoring market conditions as they assess the timing for their initial public offerings.

“We expect internet IPOs in H1/H2CY24 as market conditions improve. Most large internet companies are well capitalized and less likely to require funds immediately,” analysts at AllianceBernstein wrote in a recent report.

“Some earlier announced IPOs include OyO Rooms (hotels, homes aggregation) & Indegene/Tata Tech (IT Services) We expect other potential IPOs in 2024 including Reliance Retail, Flipkart & Swiggy which could add ~150 Bn $ of market cap.”